The rumour swirling around is that a famous Premier club is interested in buying a stake in one of the Indian Premier League (IPL) expansion teams.
Lalit Modi, the IPL commissioner, was quoted in the Times as saying: “There is a football club, a very famous football club in the UK, very interested in bidding.
“[They are] probably one of the most famous football clubs – that’s all I can say. Probably top three. They are interested in taking a stake.”
When Lalit Modi says one of the most famous clubs, it is not City he is referring to. Top three?
They might have the money but the characterization of the club is all wrong. Manchester United, Chelsea, and Arsenal are all in the top clubs but off them Arsenal with its investment wary board might be reluctant to park money in an IPL franchise. Besides they see China as a more acceptable destination for increasing club exposure. Chelsea is a one owner club whose goal now seems to be recouping the millions of dollars loaned in investment by converting into club equity. He has yet to turn a profit.
Manchester United has a huge following in India and have been very proactive in increasing their India profile but the Glazer’s ownership of Man Utd itself is quite an adventure for a low key business family that has taken on more debt and is struggling with an under performing bond issue. Opening a restaurant and earning millions in brand naming without taking on risk is a different story from direct ownership of a club in a sport even more unfamiliar to US businessmen.
Tom Hicks, the more reviled of the two Liverpool owners has long sought an out from his ownership share. With Liverpool proving to be a tough sell in recessionary times, the Texan who has proven to be restless when it comes to buying sporting franchises might be eying the Indian market. The IPL affords all his signature moves.
The IPL in its two years of existence has almost overnight become one of the top brands in sports with a valuation of $1.6 billion. It ranks sixth in the top ten just below the World Cup. The IPL is now the world’s hotbed of 20Twenty cricket with investors attracted to its vast potential as a lucrative money spinner.
A nascent sporting brand, high rate of return, a huge fan following of millions, unlimited media exposure and Bollywood star power, and a booming economy. All at very affordable investment levels with little risk. Hicks has been purportedly interested in getting into the Indian cricket business since the explosion in the popularity of the Twenty20 version.
The interest has been reciprocated with Indian companies who own IPL teams or have sponsorship deals linked with a Liverpool buyout. GMR Holdings, the owners of IPL team Delhi Daredevils was in the news reportedly interested in a Liverpool takeover worth £500m last season. More recently Mukesh Ambani, the owner of Mumbai Indians and the 6th wealthiest man in the world, was linked with buying out a 51% stake in Liverpool along with Subrata Roy, owner of Sahara India, a former sponsor of the Indian cricket team.
Hicks is infamous for investing very little money of his own into Liverpool, putting the debt on the club’s books and securing loans on its assets. The IPL foray looks like a perfect get rich quick opportunity for an investor not steeped in sporting tradition looking to boost his own personal income. Liverpool ownership is an attractive and recognizable resume builder.