Is IPL the Indian Paisa League?
Barely two years ago, when Mukesh Ambani's Reliance Industries Ltd made the highest bid for an Indian Premier League franchise (Rs 441 crore for Mumbai), many termed it as a massive gamble on a risky concept. The IPL sure has come a long way in a short time, with the Sahara group recently bidding Rs 1,702 crore for Pune and a little known Rendezvous Sports backed by the State Minister for External Affairs Shashi Tharoor forking out Rs 1,533 crore for Kochi. These two bids, worth a total of about Rs 3,235 crore, add up to more than the Rs 2,853 crore collectively paid by the existing eight franchise owners in the first auction, on January 24, 2008. Talk about the power of IPL.
Little did we know that the addition of new franchisees would open a can of worms. Now the Tharoor-Modi row prominently appearing on every news media and TV channels, the focus is well off the foreign cheer leaders and the cricket field.
Who represents Rendezvous Sports?
Interestingly the only connection in the Kochi Franchise for a Malayalee is Vivek Venugopal, a builder from Kerala who holds 1% stake in the Franchise. However, it is learnt that the group also includes Anchor Switches, Rosy Blue Diamond, Mukesh Patel, and Ravi and Sanjay Gaikwad. Anchor Switches is a company from Gujarat and is owned by Mehul Shah. Rosy Blue Diamond is one of the world's largest diamond manufacturing companies. Dilip Mehta is the CEO of this company, which owns jewellery brand 'Orra'. Ravi and Sanjay Gaikwad are Mumbai-based businessmen. Sanjay Gaikwad is the CEO of UFO Moviez. Mukesh Patel is an education baron who runs technology, management and engineering institutions.
With big money involved in procuring an IPL franchise one wonders how the franchisees' recover their money. For the franchisees' the main source of revenue comes from selling broadcast rights. Apart from that other source of income include proceeds from selling merchandise, sponsorship and selling tickets. BCCI takes a cut of 20% of broadcast revenue and 40% of advertisement revenue.
Brand IPL is currently estimated to be worth $4.13 Billion. The football championship English Premier League is worth $12 Billion, but IPL has reached $4 Billion in less than 3 years and will soon catch up other sports like football and Formula 1.
Now let us look closely at the ongoing row between IPL Chairman Lalit Modi and the union minister Shashi Tharoor after the later negotiated the deal for Rendezvous Sports to procure the Kochi Franchise. What began as a juicy side-show to the IPL is now threatening to dwarf the tournament itself. The Lalit Modi-Shashi Tharoor spat turned ugly with the junior minister and his aide accusing Modi of‘‘breaching all propriety’’ in his efforts to discredit the Kochi franchisee.
The minister’s aide accused Modi of trying to buy out the consortium with an “offer” of $50 million, while Tharoor himself decried Modi’s ‘‘contemptible efforts’’ to ‘‘drag in matters of my personal life’ ’―a reference to his alleged romantic ties with Sunanda Pushkar, a Dubai-based socialite-businesswoman , who reportedly holds a ‘free equity’ stake in Rendezvous Sports worth Rs 69 crore.
As the plot rapidly thickened, Lalit Modi, currently under a gag order from BCCI, kept below the radar. However, his associates denied all the allegations.
Meanwhile, political parties too jumped into the fray. The BJP has demanded Tharoor’s sack for ‘‘ improper behaviour’’, while the Congress seemed interested in the drama but disinclined to get involved in it. The IPL governing council will meet in 10 days where Modi is expected to deny that he tried to muscle out Rendezvous to help other interested parties.
Would the Shashi Tharoor-Modi row affect the future prospect of IPL? If the dirty linen is washed in public it indeed seems possible. But what turn of events can ease the tension? Would getting Sunanda Pushkar out of the Rendezvous stake help? Or would it take turning over the ownership altogether to another aspiring franchisee? Whatever may be the case, the stakes are high for Shashi Tharoor to clear his name and Congress high command would not go easy on the tweeting minister this time around.
Rajesh Kumar
