Wednesday, October 27, 2010

Indians to Buy Part Of Australian Cricket Team

Cricket Australia is facing its most crucial 48 hours in recent history to combat plans of Indian investors trying to seize a share of our Twenty20 game in the biggest shake-up since Kerry Packer's World Series Cricket.

Reports reveal Australia's most powerful cricket states, New South Wales and Victoria, have already sold shares to giant Indian corporations for around $60 million in return for profits from an IPL-type eight-team tournament to start in Australia in January 2012.
CA board members will meet in Melbourne over the coming days to decide whether to accept private equity from Indian and other overseas investors as part of the ownership structure for each franchise, which could be worth $80 million each in a few seasons, four times their initial value of $20 million each.
Chief executive James Sutherland has described the setting up of the tournament as "the most significant development since World Series Cricket" and is fully aware state bodies have threatened to establish a breakaway competition if the overseas investors are turned away.
"It's a moment as big, if not bigger, than the Kerry Packer moment when his role resulted in one-day international cricket taking off and basically funding the development of Australian and world cricket for 25 or so years," CA spokesman Peter Young said.
NSW Cricket has reportedly set up a separate business entity, known as Blues Inc, to run the state's Twenty20 franchises.
It is understood the Indian investors want a 49 per cent share of the company and have all but signed off on a figure of $30 million.
"The Twenty20 franchises in Australia could eventually be worth $80 million each," said one cricket insider.
"It's a staggering amount of money considering an NRL club like Brisbane Broncos is valued at around $30 million. That's why the Indian corporations are so keen to get involved as an investment.
"One-day cricket is dying, the only Tests people care about are the Ashes and India, and everyone knows Twenty20 is the future of the game."

Twenty20 Revolution

  • Australia's version of IPL will have eight teams
  • Two Sydney, two Melbourne, one Brisbane, one Perth, one Adelaide, one Hobart
  • Teams play each other twice before finals series
  • Tournament will be played over five weeks and will replace one-day games
  • Matches to be televised on Fox Sports and Nine and sold to India and other overseas networks
  • Starts January 2012 at all major city cricket grounds and possibly major regional areas
  • Gaps will be left in Australia's Test calendar to ensure all superstars will be available
  • Huge money will be offered by franchise owners to attract overseas stars
  • Sponsors will be offered naming rights of teams
  • Franchises will initially operate under a salary cap of between $2 million and $2.6 million
The Australian tournament will involve eight teams, two each from NSW and Victoria, and one from each of the other states. It will feature all of Australia's current stars and retired champions like Shane Warne and Glenn McGrath.
Overseas stars from India, England, West Indies and South Africa will also be offered mega-contracts to play in a tournament that will replace the traditional one-day cricket over January and February.
NSW cricket chief executive Dave Gilbert would not return text messages or phone calls on Wednesday night to discuss selling 49 per cent to Indian interests.
NSW and Victorian administrators are understod to have been secretly negotiating with the Indian companies, through a prominent middle man, for 12 months.
"The states have taken it upon themselves because they believe Cricket Australia has been too slow to embrace the game," one source said.
"All cricket's research shows the major proportion of people who watch the game are males over 45.
"They can't connect with women and kids. The states - and their investors - obviously feel they can through Twenty20 cricket, but they are not prepared to just sit back and wait while Cricket Australia has done very little about it."
Sutherland said getting the big decisions right to set up the Big Bash League (BBL) will be one of the most important moments in Australian cricket history.
"If we get BBL right, it will have a significant role to play in cricket continuing to be a major Australian sport," Sutherland said.
Cricket Australia's AGM on Thursday will include a detailed presentation on the Big Bash League.
Around 50 senior officials from Australian cricket will be at the AGM, including all 14 directors (who represent the six state cricket associations who set up CA), the State Cricket Association chief executives, Sutherland and his senior management team.
Following the AGM, the future of Twenty20 will be the major item up for discussion at a board meeting.
A NSW official, who asked not to be identified, said CA is under massive pressure to accept private investors.
"The door to private investment was opened four years ago via the Indian Premier League and this has seen an influx of funds into the Board of Control for Cricket in India's (BCCI) coffers whilst other countries simply provide their players and support this revenue growth in the process," the official said.
"While India has thrived, Cricket Australia's revenues have taken a hit given the GFC, the strength of the Australian dollar, with less tourists coming, and declining gates.
"Cricket needs an injection of capital that will allow it to compete for the younger audience and women the game desperately needs."

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