With two new teams, Kochi and Pune, attracting well over $300 million at Sunday’s auction, existing eight team owners can look forward to similar valuations when they sell part of their stakes. While there have been talks of Kings XI selling stake for some time, this is the first time that Mr Wadia has accepted the intent of the franchise owners to sell part of the company.
The Kings XI team is currently co-owned by Ness Wadia of Bombay Dyeing, actor Preity Zinta, Mohit Burman of Dabur and Karan Paul of the Apeejay Surendera Group.
“We are open to selling stake if we feel that there are investors who can bring in not only financial but also strategic value to the business,” Ness Wadia said, after weeks of denying stake sale talks. For him, a good valuation is close to $300 million.
“I would say a good value to be somewhere around $250-300 million and it (stake sale) also depends on who the investor would be,” the Bombay Dyeing group heir told ET in Mohali. At least three Indian Premier League teams are reportedly considering stake sale to cash in on the enormous marketing success of the twenty20 tournament, now that their three-year lock-in period is close to get over.
Mr Wadia also says that the franchise may look at trading high-performance players at a premium to get return on investments. “Apart from enhancing raw talent from the grass roots to a level they can be traded, we will also look at trading players that we own now at a higher value to generate monetary returns to the franchise,” says Mr Wadia.
Shortly after the high bidding for Pune and Kochi last week, there had been speculation that promoters of Kings XI Punjab were seeking to exit. Kings XI Punjab had gone under the hammer three years ago for $76 million.
Who will be prospect buyer?
After losing out to Sahara India in its bid to buy rights to new IPL franchise Pune, the Videocon Group, sources said, is now looking at joining the bandwagon by buying into Kings XI Punjab franchise.
Venugopal Dhoot, chairman of Videocon Group said on Thursday, “I lost out in the IPL bid last week in this very city. So I’m certainly open to picking up a stake in one of the existing teams.” When asked specifically about the Punjab team, Dhoot refused to confirm. However, he did not deny it either. “There are bound to be such rumours and of course, there are offers from various teams. But I have the Non Disclosure Agreement (NDA) to adhere to and cannot confirm anything at this stage.”
Dhoot’s VC Digital was in the running for the Pune franchise with a bid of $319.9 million in last Sunday’s auction, but lost out to Sahara’s hefty $370 million bid for Pune and Rendezvous Sports’ bid of $333.33 million for Kochi.
Back in 2008, the Kings XI team had bid $76 million to win franchise rights over the Punjab team for a 10-year period. It is not known if Videocon is interested in buying partially into the team or the stakes held by all the shareholders.
Dhoot is known to be a cricket lover said “I am a businessman, so for me to enter into the IPL, I need to be in a deal that makes business sense”
The IPL, now in its third edition, is currently in frenzy. With revenue projections of the current edition put at more than $ one billion, IPL commissioner Lalit Modi said, “There is no other sporting event across the world generating more eyeballs than the IPL.”