Published>Mon, Mar 08 10 02:12 AM
The governing council of the Indian Premier League (IPL) has called off the bidding process for the two new franchises following requests by many corporate houses to relax the existing clauses. The existing clauses specify that bidders need to have a net worth of over $1 billion (around Rs 4,600 crore), along with IPL's demand of a guaranteed advance payment of $100 million (Rs 460 crore). All existing tenders, which were to be opened at 12 pm on Sunday, have been returned to the bidders.
The bidders can now take back the Rs 5-lakh deposit or they can resubmit it on March 9 to collect the new tender document. IPL will accept the tenders only on March 21 at 10 am. On the same day, the bids will be opened at 11 am in Chennai, followed by the announcement of the winning bids.
IPL commissioner Lalit Modi said, "We have received letters from many companies who have expressed interest in bidding for the two new franchises, but the criteria of $1 billion net worth which owners are asked if they want to bid eliminates them from bidding." He further said the clause has been done away with to give opportunities for more people to bid.
A source close to the development said, there could be three possible reasons for the deferment of these tenders. First, only 11 tender forms were sold, of which only 5-6 were submitted. Of this, two companies, Videocon and Adani Group, were the front runners. Moreover, it is also believed that the bidding prices did not meet the expectation of the IPL governing council. Even though the base price of $225 million remains unchanged, Modi's repeated emphasis was on the debate within the council to increase the base price. It is also speculated that Modi wants to resolve issues with the News Broadcast Association (NBA), which has currently boycotted the proceeds of the tournament. It is now estimated that Bollywood actors such as Ajay Devgan and Sanjay Dutt who pulled out because of the steep bank guarantee, are expected to file fresh tenders.
Interestingly, Venugopal Dhoot, who was rumoured to have won the franchisee for team Pune, showed his disappointment with the cancellation of his tender. "We are, of course, disappointed that our document got deferred without the governing council citing a reason for it. We had complied with all the stringent clauses required, be it the $100-million bank guarantee or the Rs 5,000 crore net worth. There are no grievances as such because it's cricket. We don't want to fight on small things," he added. "In case there is a need to increase the bid amount, we will do so. Pune is our land and we will bid for the same."
IPL, which has turned out to be the most valuable cricket property in no time, is increasing the number of franchise teams from eight to ten from its fourth season. The minimum bid price has been fixed at $225 million (Rs 1,035 crore) per franchisee, against $50 million (over Rs 230 crore) in the maiden auction in 2008, when franchisees were required to submit just 10% of their bid amount as bank guarantee.
Despite the IPL's governing council opting for a re-tendering, the base line for any bid for a franchise will remain at $225 million with locations in Pune, Ahmedabad, Nagpur, Kanpur, Dharamsala, Vizag, Rajkot, Cuttack, Baroda, Kochi, Indore and Gwalior still the only possibilities.
The decision of canceling the bidding process was taken after a prolonged meeting in Mumbai, which was attended by Bollywood stars Saif Ali Khan and Kareena Kapoor, along with Videocon Industries' Venugopal Dhoot.
Source: Web Search
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