It pipped e-learning startups Byju’s and Unacademy to walk away with the rights while Tata Sons, which had also ‘expressed interest’ in the property, did not come to the bidding table. In effect, all three participants turned out to be Indian tech startups.
BCCI had floated an ‘expression of interest (EOI)’ for potential bidders to walk in after their existing title rights partner Vivo India and IPL parted ways two weeks ago owing to the recent tension between India and China. Vivo was contracted to pay the IPL Rs 440 crore per year as part of a Rs 2,190 crore deal for five years.
Dream 11 have made a Rs 222 crore bid for the 2020 edition, along with negotiations and tacit understanding that they will continue to own the title rights for the next two years – 2021 & 2022 – should Vivo not return.
If Vivo does not return, Dream 11 will pay the BCCI Rs 240 crore each in the second and the third year, under the new arrangement. Should Dream 11 continue until 2022, the BCCI will earn an average of Rs 234 crore from Dream 11 each year for three years, which is technically around 50% of what Vivo was paying for the rights.
However, where BCCI will further make up for Vivo’s exit is by bringing in two additional official partners at Rs 40 crore each. E-learning start-up Unacademy and fintech company Cred had already closed verbal negotiations with the BCCI, which were subject to title rights. “Unless Byju’s decide to up the game and bid a higher amount, Unacademy and Cred will commit Rs 80 cr between them to the IPL kitty,” sources in the know said.
At an additional Rs 80 cr per year, added to the average of Rs 234 cr that Dream 11 will pay the BCCI for the title, the IPL will be assured of sponsorships close to Rs 310 cr per year for the next three editions – making up for almost 65% of what Vivo was paying.
“And that is actually the correct value. Vivo was over-paying,” industry executives told TOI after the bids were opened.Byju’s and Unacademy came up with a bid of Rs 201 crore and Rs 171 crore respectively.
Apropos of the controversy surrounding Chinese gaming major Tencent’s single-digit investment in Dream 11, the BCCI is convinced that the start-up “is essentially an Indian company driven by two Indian entrepreneurs and therefore, not a concern”.
In fact, the board’s view is that “Dream 11 will boost IPL’s fan engagement that has been lying passive over the last few months”, especially due to the Covid-led slowdown.
Meanwhile, despite all the hype surrounding Tata Sons expressing interest, the salt-to-steel conglomerate did not come up with a bid. TOI can confirm that Tatas were looking to make a “handsome bid” subject to certain conditions that did not work out.
Tatas’ primary objective was to block three categories (different brands under the group) through the title sponsorship while the BCCI had maintained that the space would only allow the blocking of a single category. “That’s was never going to work for the Tatas”, sources in the know said, adding “but their expressing interest helped BCCI in spiking the bid values”.