Having completed the mandatory ‘lock-in period’, the owners of the Hyderabad-based IPL franchise face no exit hurdles.
The much-awaited sale of Indian Premier League franchise Deccan Chargers is likely to be a reality soon with Deccan Chronicle Holdings, which owns the team, seeing no hurdles in exiting. While the DC management is not willing to make any official comment as yet, it feels that there is no problem in selling off the stake since it has already completed the mandatory three-year lock in period.
“The franchisee agreement mandates a three-year lock-in, which we have already completed. The sale has to be approved by the governing council of the IPL. Apart from that, there are no other hurdles for exiting,” N Krishnan, managing director, Deccan Chronicle Holdings, said. However, on the decision of selling off and on the talk of Adani group buying out DC’s stake, Krishnan said, “I have nothing to say on that. I can only say that there has been a lot of interest.”
Investment banking circles have been talking about an “almost concluded” deal between the Gujarat-based Adani group and Deccan Chronicle for a possible buyout. The Hyderabad-based media house owns about 80 per cent in the team and is expected to either exit the team completely or keep a minority share for itself. The deal size is estimated to be in the range of about $280-300 million.
In fact, Deccan Chargers is likely to result in a profit for the company this year. For the year ending March 2011, the team would provide a profit of Rs10 crore.
“We should get a profit of Rs10-11 crore this year. The team has brought in revenue of about Rs85-90 crore. While about Rs40 crore came in through sponsorship and sale of tickets, about Rs50 crore came in from central rights. On the cost front, there have been outflows in the form
of players’ cost of about Rs35 crore, operating costs of about Rs25 crore. We are confident that there are going to
be profits by this year-end from the team,” Krishnan explained.
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