Indian cricket turns to the big financial leagues
MUMBAI (Reuters Breakingviews) – Indian cricket tries to cross the border. One of America’s major sports investors has agreed to buy part of the Rajasthan Royals in a deal that leads the team and the quick and flashy Indian Premium League, closer to securing a sports crown international.
The Royals are one of eight to take part in the popular annual tournament watched by nearly half of the nation’s 1.3 billion people. RedBird Capital Partners takes a 15% stake, adding to a collection of investments that includes Red Sox baseball and Liverpool Football Club football. The defending champion Mumbai Indians are one of the trophies of Mukesh Ambani’s Reliance Industries.
Under the deal, and another that brings majority owner Emerging Media’s stake to 65% from 51%, the Royals are valued between $ 250 million and $ 300 million. It’s pretty much the same as European football clubs SS Lazio and FC Porto, both of which rank in the top 30 companies in sport according to KPMG’s European Elite 2021 report. That’s only about a third of Major League Baseball’s least valuable team, the Miami Marlins, according to Forbes figures, but the IPL also only plays two months a year compared to baseball’s six.
RedBird’s drive to support business growth underscores the American-style lucrative potential of the Indian tournament. Some 45 minutes of advertising are already crammed into each four-hour game. This is on par with the time spent on commercials during the Super Bowl and much more so than in European football, where breaks are usually reserved for half-time. Cricket advertising time is also considered recession resistant. Indian broadcaster Star Sports, part of Walt Disney, paid $ 2.2 billion for the league’s TV and digital rights from 2018 to 2022, an extraordinary price for a young league in a poor country.
After a pandemic-induced mid-tournament suspension, IPL will resume in September in the United Arab Emirates. It might be without some of its star foreign players, but when the league returns to India they will be in a better position to show their money-spinning power.
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– Indian Rajasthan Royals announced on June 24 that US investor RedBird Capital Partners will buy a 15% stake in the Indian Premier League cricket team. Majority owner Emerging Media will also increase its stake from 51% to 65%. The deals value the franchise between $ 250 million and $ 300 million, according to a person familiar with the situation.
– RedBird will provide strategic capital and advice to support the team’s long-term growth and business goals, the Royals said in a statement.
– Financial details were reported earlier by the Financial Times.
– For previous author columns, Reuters clients can click [GALANI/]
(Edited by Jeffrey Goldfarb and Katrina Hamlin)
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