MUMBAI: The former IPL chairman Lalit Modi has said that the BCCI could lose Rs 20 billion over the termination of the Kochi IPL franchise.

On twitter, Modi wrote: "Kochi now being terminated - a further loss of 1500 crore to BCCI. Compounded by reduction in Media Rights. My estimate 2000 crore. Who is responsible for this mess now? Current president and outgoing president for sure. Who will they blame now for this. Where is the accountability and who will take responsibility,"

Expressing a sense of vindication over the mess, he wrote on his blog that the BCCI?s termination of the Kochi Tusker?s IPL franchise for non-payment of a bank guarantee is a financial mess he had predicted over a year ago. This was a mess he was prevented from trying to avoid during his time as IPL commissioner, he added.

"The news, which came out of the BCCI AGM in Mumbai, is another example of how the vendetta against me is being laid bare.?

Modi said that he had proposed a financial condition that would filter out all but the most serious and robust of bidders. This condition stipulated that bidders should have a capitalisation of no less then $1 billion and was created to ensure they had the ability to support an IPL franchise.

A commissioned report compiled by Ambit and KPMG confirmed that 73 Indian companies had a net worth above $1 billion and 156 had market capitalisation above that figure.

?So we knew there was a significant market at this level. Furthermore, with the reserve price for a franchise set at $225 million, the net worth of a successful bidder would be at least four times the reserve price of a new IPL team; a further safeguard against a consortium investing beyond their means.

?Its also interesting to note that part of the BCCI requirement was to generate interest from bidders for whom an IPL franchise was neither its sole, or its main business. Capitalisation of at least four times the reserve price, would ensure that bidders would clearly have other, significant interests and would also help to ensure their ability to meet annual payments over the required ten-year franchise period. In summary then, the BCCI wanted involvement from those who already had credibility, not those for whom the IPL would provide it.?

For some reason, the BCCI had a late change of heart and, after approving the initial conditions, they effectively brought more bidders into the mix by requesting lower the capitalisation requirement.

?After the award of the franchises to Kochi and Pune, the issue was compounded by my unease with the make up of the consortium which successfully bid for Kochi. Within the shareholding, there were members who were not bearing any of the risk and simply enjoying the potential benefits. This, of course meant others were subjected to a greater proportion of responsibility and I believed such an arrangement could result in potential default at some point - and problems for the IPL," he wrote.

Modi noted that 18 months later, the BCCI has terminated the Kochi contract on the basis of an unpaid bank guarantee which, according to new President N Srinivasan, ?....is not capable of being remedied." As a consequence, the BCCI now stands to lose more than $300 million by virtue of reduced commercial revenue because Kochi?s suspension means fewer teams and therefore games - not to mention a loss of credibility for the IPL itself.

Modi said it will be interesting to see who takes responsibility for an outcome he had predicted even before the contract was signed. ?It is a situation that could have been avoided but what it shows is that the unsubstantiated accusations made against me suggesting I imposed ?onerous? conditions purely to try and manipulate the bidding process towards my preferred bidders has been shot to pieces.?

MUMBAI: Cricket?s richest body, the BCCI, has made a net profit of Rs 1.9 billion in 2010-11, a 200 per cent increase in its surplus over the previous fiscal.

The net surplus amounted to an increase of over Rs 1.26 billion from 2009-10, including Rs 1.18 billion from the Indian Premier League (IPL).

The BCCI expects a surplus of a little over Rs 2.96 billion for the current fiscal, according to the board?s annual report.

The gross income in 2010-11, amounting to Rs 20.26 billion, has come from media rights (Rs 10.47 billion), sponsorships (Rs 4.34 billion), IPL franchise consideration (Rs 2.89 billion), receipts from International Cricket Council/Asian Cricket Council (Rs 1.05 billion), interest and other incomes (Rs 736.8 million and Rs 766.3 million).

Gross expenditure incurred by BCCI amounted to Rs 18.37 billion. The expenses included payments to franchises (Rs 3.90 billion), TV and infrastructure subsidy to affiliated associations (Rs 2.37 billion and Rs 1.31 billion) and IPL subvention (Rs 2.03 billion).

Hosting of the cricket World Cup won by India cost the BCCI Rs 669.7 million, BCCI said in its annual report.

MUMBAI: India?s cricket board has scrapped the contract of Indian Premier League (IPL) franchise Kochi Tuskers Kerala for breaching its terms and conditions, setting in process the possibility of a lawsuit.

The Board of Control for Cricket in India?s new president Narainswamy Srinivasan said today the decision to "terminate the franchise" was over payment issues.

The Kochi franchise defaulted on a Rs 1.56 billion annual payment it was to make as bank guarantee.

Srinivasan, who took over the reins as BCCI president from Shashank Manohar, said the board will encash the annual bank guarantee in order to recover the dues that the franchise owes.

"Because of the irremediable breach committed by the Kochi franchise, the BCCI has decided to encash the bank guarantee in their possession and also terminate the franchise," he stated at a media briefing after the board?s annual general meeting here today.

Asked if the BCCI would reconsider its decision and give the franchise a chance to return, Srinivasan bluntly rejected such a suggestion. "No, we have terminated the franchise because the breach is not capable of being remedied."

The consortium behind the kochi franchise has threatened legal action against the BCCI. Earlier the franchise owners had wanted a reduction in their fee on account of the number of their matches being reduced.

Added to the IPL last season as one of the two teams along with Pune Warriors, the Kochi franchise has been at the centre of controversy from its inception with former IPL chairman Lalit Modi questioning the shareholding pattern.

The IPL, which consists of ten city-based teams, will have its governing council take a decision on whether to have another auction for a new franchise.

In March 2010, the Sahara group had bid $370 million to own the Pune franchise while Rendezvous Sports World offered $333.33 million for Kochi.

For the record, this is the third franchise whose contract the BCCI has gotten involved with. It tried to terminate the contracts of Rajasthan Royals and Kings XI Punjab last year but the franchises got relief from the court. Those matters are still to be settled.

Meanwhile, the BCCI appointed Rajeev Shukla as the new IPL chairman, succeeding Chirayu Amin.

Vilasrao Deshmukh was appointed the Media Committee chairman, Farukh Abdullah is the Marketing Committee chairman, Jyotiradiya Scindia is Finance Committee chairman while G Viswanath replaces Amarnath in the IPL Governing Council. Stepping into Srinivasan?s shoes as BCCI secretary is Sanjay Jagdale.

MUMBAI: A new chairman will be elected for the Indian Premier League (IPL) during the BCCI?s annual general meeting (AGM) that takes place from 19-20 September.

There has been speculation earlier that Rajiv Shukla will take over the reins from the current IPL chairman Chirayu Amin who was appointed after Lalit Modi was kicked out last year. Media reports state that Amin now wants to step down as he has other responsibilities.

There has also been speculation that IPL CEO Sundar Raman will be given more responsibilities.

N Srinivasan will take over from Shashank Manohar as BCCI president. After India?s poor performance in England, changes are expected to happen in the selection committee.

MUMBAI: Finding no takers for the mobile and Internet rights, the Board of Control for Cricket in India (BCCI) has floated a new tender with a lower base price.

Cricket?s richest body has fixed the floor price for these rights at Rs 20 million per match, down from the earlier Rs 30 million.

The BCCI?s decision follows a tepid response from its earlier tender. There was just one party that had submitted a bid but the price was below Rs 30 million that the BCCI was seeking.

The last date for submitting the new bids is 26 September.

There are 17 Test matches, 29 one day internationals, and two Twenty20 games.

A sports marketing executive says that there needs to be some understanding on the part of the board in terms of what these rights are worth. New media is still at a nascent stage and has not grown like in some of the developed countries.

This is the first time that the BCCI is selling mobile and Internet rights to domestic and international matches as a standalone property.

The new media rights were previously held by Nimbus, along with the television rights, way back in 2006. Nimbus had forked out $612 million for the combined rights for four years.
 

MUMBAI: The shifting of the second edition of the the Indian Premier League to South Africa has cost the Board of Control for Cricket in India (BCCI) dearly.

Cricket?s richest body suffered a loss of Rs 420 million due to the event, resulting in drop in profits to Rs 212 million in 2009-10.

The BCCI has told the Income Tax Department that the IPL is losing money. The department is seeking to recover tax from the BCCI fully for the assessment year 2008-09. The BCCI has to pay taxes after it lost its tax exempt status.

The department had conducted first survey on the IPL in April last year and followed that with an investigation of IPL franchises. The BCCI made a profit of over Rs 3 billion in 2007-08 on an income of over Rs 10 billion. This was the first time that its income touched this level.

However, BCCI?s income fell by 28 per cent while profit fell by a huge 85 per cent in 2008 as result of the first edition of the IPL. Its surplus dropped to Rs 632 million in 2009-10, which was further worsened by the Rs 420 million loss mentioned earlier.

The profit could drop further as the assessment of income returns of 2009-10 are still pending. The BCCI is yet to submit accounts for the 2010 and 2011 IPL editions to the department. The IT Department gets revenue in the form of tax deducted at source (TDS) on payment to players, coach, umpires, commentators, event managers, besides other professionals.

The BCCI has paid Rs 1.31 billion in taxes for 2007-08 and Rs 1.18 billion in 2006-07.