The Indian Premier League (IPL) Twenty20 cricket tournament is expected to see renewed high-stakes bidding with two new teams up for grabs from the fourth season starting 2011.
Bidders will be offered a choice of eight to 10 cities that can be made their home team venues and they will be allowed to bid for any number of cities. The highest two bids will be chosen and companies will use the name of that city as their home base and team brand.
Several individuals and companies have shown interest in owning IPL teams, such as actors Ajay Devgan, Salman Khan and Sanjay Dutt, and the Anil Dhirubhai Ambani Group.
The announcement ends month-long speculation that the Board of Control for Cricket in India (BCCI) was reluctant to expand the IPL calendar of 49 matches.
Sources say the bidding for the two new teams will take place next year, although the dates have not been finalised.
IPL Commissioner Lalit Modi expects the minimum base price for bidding to be fixed at $250 million, five times the base price for the eight original teams that were auctioned in 2007.
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It is also more than double the price of $111.9 million that Mukesh Ambani paid to win the Mumbai Indian team.
"If the broadcasting rights are not renegotiated, a price of $150 million to $180 million makes sense. But if the TV rights are substantially renegotiated (which is possible since the number of games will increase with two more teams) then a floor price of $250 million should not be a problem," says Anirban Das Blah, managing director of sports management agency KWAN.
That is because teams share around 80 per cent of the broadcasting rights money which will increase if the rights are renegotiated upwards.
These high valuations are no surprise since businessman Raj Kundra and actor Shilpa Shetty bought 12 per cent in Rajasthan Royals for $16.8 million, valuing the team at $140 million last year. The team was initially bought for $ 67 million by Emerging Media.
Season 4 will also see an end to the "icon" status of the four players Yuvraj Singh (Mohali), Virender Sehwag (Delhi), Sachin Tendulkar (Mumbai) and Rahul Dravid (Bangalore). "All current players have been contracted for three years, so the contracts of all of them will come up for renewal then," said a BCCI source.
Sources in BCCI say the format of season 4 is also likely to change. Currently each team plays seven matches at home and seven away. For IPL4, the board is considering the knock-out format in which there will be two pools of five teams each. This is, however, still under consideration.
The decision to include two more teams was taken after a recently-held workshop of IPL franchisees. IPL's organisers also decided that a player trading window for IPL3, to be played in 2010, will open from November 23, 2009 and will last till January 5, 2010.
For new players the auction will be held on January 19, 2010 in Mumbai for which each team will be allowed to spend an additional $750,000.
“I am certain now that we are poised to bring a significantly enhanced IPL experience back home to the Indian fans in season 2010,” Modi said.
He added that some important decisions regarding the use of four fielding substitutes instead of the twelfth man, utilising the services of the ICC Anti-Corruption and Security Unit and player regulations, were also taken.
On the sponsorship front, IPL plans to add some new central sponsors, including Official Partners and sponsors for the Orange and Purple cap, innovations that were introduced in the first two editions.