The Pitch: Bats, Bollywood and billionaires – the buyers vying for Irish T20 franchises
Abhishek Bachchan meets members of the Adamstown Cricket Club in Lucan, Dublin. The Bollywood star is a co-founder of the European T20 series. Pic: Ramsey Cardy/Sportsfile
A series of Indian, Silicon Valley and private equity investors are weighing up prioritised options to buy the two Irish cricket franchises announced as key participants in the new European T20 Premier League (ETPL).
The T20 franchise business is one of the wealthiest and fastest moving investment markets in world sport, with some exceptional growth surges revealed across the game, in recent months.
The Indian Premier League (IPL) is one of the most valuable sports leagues in the world - worth approximately $16bn (€14.8bn), with each of the eight teams valued at an average of $2bn.
The England and Wales Cricket Board (ECB) has appreciated soaring revenue over the past eight weeks with the sale of its franchise clubs in the Hundred Series, achieving values as high as £300m (€360m).
Investors in the Indian and UK leagues, along with private equity funds, are the preferred bidders for ownership of the two Irish teams – one from Dublin and one from Belfast – which will make up the six team ETPL, beginning this summer.
The other four sides which form the competition will be based in Scotland and the Netherlands, in host cities Edinburgh, Glasgow, Amsterdam and Rotterdam - with room to expand the league to other International Cricket Council (ICC) nations.
The European market is seen by the ICC as a pivotal in the growth of its T20 franchise leagues, where the concept has skyrocketed in the US with the emergence of the NCL and hundreds of millions of dollars in investment.
The success of the ETPL is based on a 5-10 year strategic growth model, with backers of the placing ambitious targets to achieve maximum value for each of the six franchises from the beginning.
While not a guaranteed forecasting identifier on the future values of the Irish franchises, those behind the league are scaling potential pricing, guided by the exceptional growth of the Hundred Series, our nearest T20 league.
In January a valuation of £290m+ (€347.16m) was agreed for the biggest club, London Spirit, by the Silicon Valley tech consortium which won a bidding war with potential investors, including Todd Boehly of Chelsea and the Glazer family – majority shareholders of Manchester United.
The rules of the ECB-run league only allows investors to take a 49 per cent stake per franchise – with the minority ‘Spirit shareholding achieving £145m in deposits.
The remaining 51 per cent is controlled by the ECB - however, with the Irish, Scottish and Dutch ETPL, investors will have a opportunity to purchase 100 per cent of each of the six franchises.
Any investment is subject to approval by the ETPL itself and ultimately agreed by the ICC, which has sanctioned the league.
So how much cash can the ETPL hope to generate from the sale of its two Irish teams, through the current bidding process?
If you take a cricket-investment, industry-accepted indicator, teams here could achieve a 10-15 per cent value of the current highest price paid for a franchise in the UK.
That 49 per cent of London Spirit was bought by a consortium led by US-Indian billionaire Nikesh Arora - CEO of Palo Alto Networks - the world’s leading cyber security firm based in California’s Silicon Valley.
The £145m purchase fee created enormous excitement across the cricket franchise world, by achieving even greater value than had been expected for the Lords-based team.
Based on overall valuations for the London side we forecast that Irish teams can achieve somewhere between €35m-€53m if the market catches fire.
While Todd Boehly missed out on London Spirit, he did purchase a 49 per cent stake in Trent Rockets for £40m and is believed to have a stake-holding in Indian Premier League side Lucknow Super Giants.
Could he be an investor in the ETPL? He will certainly have been spoken to about the possibility.
While nobody pretends that the ETPL can reach the same heights as the IPL or the Hundred, there is enough optimism and expectation that any new ICC-backed T20 franchise league can achieve long-term value.
Perhaps a more accurate comparison in scale comes through the recent sale of Welsh Fire, also in the Hundred Series, which achieved an initial valuation of £67m (€80.2) with total investment for the ownership achieving £33m (€39m).
Fire was purchased by Washington Freedom owner, Indian-American tech billionaire Sanjay Govil, founder and chairman of Infinite Computer Solutions, based in Rockville, Maryland with annual revenue of $2bn.
Like Boehly, both Govil and Nikesh Arora will be amongst those considering investment in the ETPL and its Irish franchises.
Whatever prices are paid for the six ETPL sides - their valuations will be strongly set on future potential for the brand and the reach and revenue expectation of the new T20 league.
Those behind the European T20 series – including co-founder and Bollywood star Abhishek Bachchan – believe the growth of the short-form game will open up large markets here and in India, where games will be broadcast at live peak-viewing periods.
Bachchan is so confident the league will pay off, that The Pitch understands he has put down $6m of his own fortune on the venture, although the actor and club owner declined to confirm the number when it was suggested to him last week.
For the Dublin franchise purchase, potential investors will know that that the side will soon have its own stadium, with Cricket Ireland planning its own purpose-built venue in time for the ICC T20 World Cup in 2030 - hosted along with England and Wales.
That ground, at Abbotstown, should be operational by 2028, and will see the Dublin club set up home from its temporary base in Malahide.
Other investor options being considered here are tech companies with a presence in Dublin and India, although the ICC are said to prefer buyers with a track record in T20 franchise ownership, and a knowledge of the integrity and complexity of the process.
Speaking to The Pitch, Abhishek Bachchan said that he expects there to be a healthy turnover from the ETPL within three to five years, but is adopting a patient strategy of anywhere between five to 10 years, if necessary.
“Let’s be honest - we’re all here - we’re not doing charity, we’re doing it for business and I feel that’s very good because when you’re doing it as a business you’re going to do whatever it takes to make it a success,” he said.
“I personally feel for our part, we’re willing to do whatever it takes and invest whatever it takes to run this tournament the way it deserves to be run.” And if current forecasts fail to achieve their aims, what then, cut and run?
“I’m not the kind of person to cut losses and move out, I’m somebody who likes to stick with something that I’ve added my name to because that means more to be than just the money,” he added.
The key priorities along with deciding on the ownership of the ETPL franchises for Bachchan and his backers, including Warren Deutrom CEO of Cricket Ireland, are to achieve broadcast rights deals and sponsorship.
The IPL receives an estimated $6bn in total broadcast rights deals – with annual headline sponsorship fees, achieving almost $60m per year from Indian conglomerate Tata.
The initial rights deal for the ETPL may even be sold at a discount to achieve that first key performance indicator – reach – with Sky in pole position, if the ETPL doesn’t compromise the network’s current portfolio of cricket deals.
Premier Sport and digital sports content giant DAZN will also form part of the conversation, and we’re told “everyone is being spoken to”.
However, the most interesting aspect is who will win the various bidding processes for ETPL franchises, particularly the two Irish teams.
And more importantly for everyone involved – what prices are they willing to pay?
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