Last month the Blues revealed that they had submitted an application to move to the 39-acre site in Wandsworth, but administrators revealed this morning [Thursday] that a joint bid by two Malaysian companies - SP Setia and Sime Darby - had been chosen instead.
A statement from Ernst & Young read: "Following an extensive global marketing campaign, undertaken by Ernst & Young Real Estate Corporate Finance and Knight Frank LLP, the Joint Administrators are pleased to announce that on Wednesday 6 June 2012 they entered into an exclusivity agreement with SP Setia and Sime Darby and are working towards a timely exchange and completion of the site and associated land."
The European champions are considering moving away from their Stamford Bridge home as their current capacity of around 42,000 is preventing them from bringing in the kind of matchday revenue enjoyed by the likes of Arsenal and Manchester United, who have much bigger stadiums.
Chelsea revealed in plans last month that they intended to transform the Grade II listed building on the south bank of the River Thames in to "one of the most iconic football stadiums in the world".
Their plan for Battersea was to develop it into a 60,000-seater ground that included the power station's four chimneys.
When they released their plans, Chelsea insisted that they had definitely not committed themselves to leaving Stamford Bridge, although they also claimed it was not economically viable to redevelop their current west London home.
The Blues have also been linked with other sites in south-west London.
SP Setia and Sime Derby revealed in a release to the Malaysian stock exchange this morning that their £400million "multi-use real estate regeneration project" bid had been successful. They also plan to build a tube station on the premises that will connect to the Northern Line.
A 28-day period of due diligence will now follow, but the hopes Chelsea had of relocating to the site of one of London's most iconic landmarks are seemingly over.
Last October the fans' group who own the freehold of Stamford Bride, Chelsea Pitch Owners (CPO), rejected an offer from the club's owner Roman Abramovich, to buy their shares.
CPO shareholders have accused Chelsea of failing to fully explore the prospect of revamping Stamford Bridge, while Hammersmith and Fulham Council have disputed the club's claims that doing so would be far more expensive that moving.
Meanwhile, Porto forward Hulk today [Thursday] denied claims he is flying to London to seal his transfer to Chelsea.
The striker has been strongly linked with a move to Stamford Bridge but insists he is happy to leave the matter in the hands of his agent while he is on international duty with Brazil, who play Argentina this weekend.
"My manager is the one who is taking care of everything," the Porto skipper told globoesporte.com.
"I left it in his hands and I'm not thinking about it before the end of friendlies."
Hulk is thought to be part of a big rebuilding process at Chelsea that comes despite the fact that the club have no permanent manager, although reports this morning claimed interim boss Roberto Di Matteo could be handed the post on a long-term basis.
Reports also claimed that the Blues are targeting Everton midfielder Marouane Fellaini after sealing the signing of Belgian playmaker Eden Hazard from Lille two days ago.