BCCI in a quandary over Kochi
Oct. 21: It’s an intriguing predicament. Even though the Board of Control for Cricket in India has threatened to boot out the faction-ridden Kochi Indian Premier League franchise, unless it gets its house in order, the move will have financial and potentially legal repercussions.
The Kochi team bought for $333.33 million by a consortium of five companies, is the IPL’s second costliest team, and kicking it out will mean that the Board will have to forego a steady addition of more than $30 million every year till 2021.
“The IPL governing council will take a decision which is right, but the board will lose quite a lot if it scraps the franchise. Their amount was set to be more than the combined earning from Rajsasthan Royals and Kings XI Punjab every year,” a Board insider told this newspaper on Thursday.
“Despite the potential loss, the Governing Council will do what is legally right.”
Although the Board can re-auction the team’s spot, corporates are unlikely to jump at the chance and cough up a similar figure. The Governing Council had issued a show-cause notice to the Kochi franchise on October 10, asking the shareholders to stop squabbling over the equity structure and reach a settlement by October 20 or face expulsion.
The six existing investors in the Kochi franchise are Rendezvous Sports World Pvt. Ltd (26%; 25% being sweat equity), Anchor Group (27%), Parinee Developers (26%), Filmwaves (12%), Anand Shyam (8%) and Vivek Venugopal (1%).
Five of the investors are locked in a dispute with Rendezvous Sports and are demanding its replacement as leader of the consortium and diluting its holding to 10%.
The Kochi franchise responded to the BCCI in time on Thursday, but also asked for a 10-day extension to resolve the dispute fully.
The BCCI for now is mulling whether to grant an extension. Its army of lawyers are poring over the past IPL contracts and studying the legal implications if it does give the Kochi franchise leeway. According to sources, the Board fears that the expelled teams can question the BCCI’s leniency in giving the Kochi franchise an option of choosing who to run the team when it had not given the same option to either the Royals or the Kings XI.
That’s not the Board’s only worry though. Every IPL contract signed between the Board’s representatives and the teams mentions that every edition of the tournament will at least have a minimum of eight teams. And if Kochi are kicked out, IPL-4 will be rendered a seven-team affair potentially in violation of the contracts.
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