Thanks to IPL, American money discovers Indian cricket at last

In the decade since Redbird Capital Partners was founded, Gerry Cardinale has acquired stakes in Fenway Sports Group, the New York Yankees’ Yes ​​Network and AC Milan. One of his colleagues, Alec Skinner, previously worked for the NFL’s Dallas Cowboys. Both men are well aware of what a billion dollar business looks like. However, the game in which they see the biggest turnaround these days may come as a surprise. “When we first started looking at cricket, we weren’t experts by any means,” Skinner said. “But the more we studied it, the more we realized what the NFL felt 20 years ago.”

That is why in June 2021, RedBird bought a 15% stake in IPL team Rajasthan Royals for $37.5 million. The money that has been poured into the league over the past 15 months shows that the Redbirds have got the deal. Four months after that deal closed, an IPL expansion team was sold for $940 million. Eight months later, the IPL negotiated a new broadcast deal worth $6.2 billion.

With over $1 billion a year, the IPL now generates annual broadcast revenue on par with top leagues such as the NFL ($10 billion per year), England’s Premier League (about $6.9 billion) and the NBA ($2.7 billion). On a per match basis, the IPL is just behind the NFL.

And suddenly many people want to. Disney and Sony were among the bidders in the broadcast rights tender last year. CVC Capital Partners has just added an IPL team to a portfolio that already has interests in rugby and soccer. Out of them defeated it? American owner of the NFL’s Tampa Bay Buccaneers and Manchester United.

Making money in cricket is a new phenomenon in India. As recently as in the 1990s, the BCCI had to pay Doordarshan to show the matches of the national team. The introduction of IPL in 2008 changed all that. IPL matches now attract a domestic TV audience of over 20 crores. “It ticked a lot of boxes from an investment perspective,” said Mustafa Ghous, director of Delhi Capitals, one of the founding teams of the league. “It’s a closed league with no relegation, so your revenue is protected regardless of your performance, while costs are limited by a player’s salary cap.” NYT

Originally published at Pen 18