Kalanithi Maran-owned Sun TV Network has bought the Hyderabad-franchise of the Indian Premier League (IPL) today after bidding Rs 85.05 crore per year.
The IPL Governing Council met earlier today in Mumbai to open the bids for a new IPL Franchise. Sun TV's franchise fee represents a premium of over a 100 per cent above the amount paid by previous owner- Deccan Chronicles Holdings Ltd (DCHL) for the Hyderabad Franchise in 2008.
The cash-strapped DCHL's contract was terminated by the Board of Control for Cricket in India (BCCI) last month. DCHL would have paid Rs 214 crore to BCCI as the franchise fee for the next five years, but Sun TV Network will end up paying Rs 425.25 crore for the five years.
It is learnt that Sun TV has paid Rs 20 crore as performance deposit and will be paying further Rs 405.25 crore as bank guarantee, which is refundable. Over and above, it will pay Rs 85.05 crore per year as the franchise fee.
Sun TV today informed BSE that the Board of Control for Cricket in India (BCCI) awarded the Hyderabad franchise as long as the league continues for an amount of Rs 85.05 crore per year payable for five years, 2013-17 (inclusive). Thereafter, from and including 2018 onwards an amount equal to 20 per cent of the Franchisee income received in such year has to be paid in four quarterly installments to BCCI.
Franchisee Income, shall mean the aggregate of all income of any kind, which accrues to the franchisee, franchisee group company of franchisee owner as a result of its operation of the franchise and the team.
Sun TV Network, is one of the largest media conglomerate, broadcasts in four India launguages. REaching more than 95 million households in India. Sun TV's channels are also telecasted in the US, Canada, Europe, Signapore, Malaysia, Sri Lanka, South Africa, Australia and New Zealand.
The second highest bid came from PVP Ventures, which had bid for Rs 69.03 crores per year for the franchise.
Interestingly, BCCI received only two bids for the auction. In all, only four tender documents were picked up.