MUMBAI: Emerging Media Sporting Holding – the parent company that owns Rajasthan Royals and second-highest shareholder of the three stakeholders that own the Indian Premer League franchise – is reportedly set to increase its stake in the franchise by 13.4%, through a proposed all-cash deal worth $26 million (Rs 1.9+ billion), pending BCCI approval.
Emerging Media owns 36.7% stake and is wishing to expand it to 50.1% through this proposed deal, Times of India reports. They have offered to buy the 13.4% stake from Kelowna Investment Ltd, a Nigeria-based company run by Indian businessman Suresh Chellaram. Investment firm Blue Water Estate Ltd owns 13.3% in the franchise.
BCCI confirmed this week that it has received the proposal from Rajasthan Royals and will be looking into it soon. The deal, if approved by BCCI, will set the franchise’s overall valuation at Rs 14.18 billion (in excess of $350m), a five-fold jump from the value at which Rajasthan Royals was first bought in 2008 at $67 million.
The board, if it gives the go-ahead, will pocket approximately Rs 100 million from the deal, as part of “Clause 10.4 of the franchise agreement that calls for a franchise to pay BCCI 5% transaction value of the sales upon consummation”, TOI further reports.
