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- CVC private equity firm acquires Ahmedabad franchise for US$736 million
- Indian conglomerate RSPG Group purchases new Lucknow team for US$964 million
The Board of Control for Cricket in India (BCCI) has confirmed the sale of two new Indian Premier League (IPL) franchises for a combined fee of more than US$1.7 billion.
The two new teams will join the IPL from the 2022 season, becoming the cricket league’s ninth and tenth teams.
Indian-based conglomerate RP-Sanjiv Goenka Group (RPSG Group) has acquired the Lucknow-based franchise for US$964 million, while venture capital giant CVC purchased the Ahmedabad expansion team for around US$736 million.
RPSG Group, founded by Indian billionaire Sanjiv Goenka, has interests in power utilities and supermarkets. Goenka previously ran the Rising Pune Supergiant team, which played in the IPL for two years while the Rajasthan Royals and Chennai Super Kings were suspended for their roles in a league betting scandal.
CVC has been investing heavily in the sports space in the last couple of years, finding most success in rugby union, having acquired stakes in the Six Nations annual international tournament, the inter-continental United Rugby Championship (URC) provincial club competition and the English top-flight Premiership. CVC also landed a major deal with the International Volleyball Federation (FIVB) in February this year.
The deal sees CVC become the first western private equity group to take outright ownership of an IPL team. New York-based RedBird Capital Partners, the investment firm founded by Gerry Cardinale, acquired a 15 per cent stake in the Rajasthan Royals earlier this year in a deal that valued the team at around US$250 million.
According to The Daily Mail, the Glazer family, which owns English soccer giants Manchester United and the National Football League’s (NFL) Tampa Bay Buccaneers, were also interested in acquiring the Ahmedabad franchise. The report says that the Glazers bid less than US$688 million for the franchise, which was ultimately not enough to see off CVC.
“The level of interest among the interested parties prove that IPL is among the most sought-after sporting leagues in the world,” said Brijesh Patel, chairman of the IPL on the new franchise buyers.
“We had bids from different parts of the world and from parties with diverse portfolios wanting to make a foray into the world of sports.”
The new franchise sales came ahead of the BCCI’s tender for the next cycle of IPL global broadcast rights. Amazon, Reliance, Disney and a the newly merged Sony-Zee Entertainment group have all been linked with the premium BCCI contract. Disney-owned Star India is the IPL’s current global broadcast partner, having paid US$2.6 billion for a five-year deal in 2017. For the 2023 to 2027 cycle it is expected that fee could grow by as much as 25 per cent.
