New Delhi
A battle can be seen on the cricket pitch between the country's two richest people Mukesh Ambani and Gautam Adani. Private equity firm CVC Capital Partners is preparing to sell controlling stake in Indian Premier League (IPL) franchise Gujarat Titans. For this, it is in talks with Adani Group and Torrent Group. According to sources, CVC is ready to sell most of the stake in the IPL franchise while keeping the minority stake with itself. The lock-in period of the Board of Control for Cricket in India (BCCI) will end in February 2025. After this, new teams can sell stake. IPL team Mumbai Indians is owned by Reliance Group.
Sources say the value of the three-year-old franchise Gujarat Titans could be between $1 billion and $1.5 billion. CVC bought the franchise in 2021 for ₹5,625 crore. US investment bank Houlihan Lokey has valued the IPL at $16.4 billion thanks to a $6 billion media rights deal. The BCCI had a media rights deal with Disney Star and Viacom18 in 2022. A source said the Adani Group missed out on buying the IPL's Ahmedabad franchise in 2021. Now there is a race between the Adani Group and Torrent to buy a majority stake. This is a great opportunity for CVC to sell its stake in the franchise. Adani and Torrent are headquartered in Ahmedabad while CVC Capital is headquartered in Luxembourg. Adani, Torrent and CVC declined to comment on the matter.
Investment in IPL teams
A second source said that IPL franchises are now attracting the attention of investors. This is because the league has established itself as an attractive asset with solid cash flow. Adani has bought teams in the Women's Premier League (WPL) and UAE's International League T20. In 2023, Adani bought the Ahmedabad franchise of WPL by making the highest bid of ₹ 1,289 crore. CVC manages assets worth ₹ 193 billion. It has made big investments in sports. These include La-Liga, Premiership Rugby, Volleyball World and Women's Tennis Association.
In the year 2021, BCCI issued tenders to add two teams to IPL. In these, Adani Group bid ₹5,100 crore and Torrent Group bid ₹4,653 crore for the Ahmedabad team. But Irelia Sports India, owned by CVC Capital, beat everyone by making the highest bid. Gujarat Titans won the IPL title in their very first season. This gave a big boost to the brand. For the financial year ended March 2023, Irelia Sports reported a net loss of ₹429 crore on a revenue of ₹359 crore. The total expenditure of the company was ₹789 crore.
Who is the most valuable team?
Gujarat Titans COO Arvinder Singh said that the franchise will become profitable in the next media rights cycle. The current media rights cycle ends in 2027. He said that even the first ten IPL franchises took four to five years to become profitable. We are confident that not only will we become profitable, but our brand value will also grow rapidly. According to Houlihan Lokey, Gujarat Titans had a brand value of $124 million and was ranked eighth in the ranking. With a brand value of $231 million, Chennai Super Kings topped the list.
