Saturday, November 27, 2010
Kochi owners reach consensus, likely to survive axe
The BCCI on Sunday allowed the squabbling Kochi franchisee to participate in the fourth edition of the Indian Premier League, ending the suspense over the team and ensuring that at least eight sides will be part of IPL 4 next year.The IPL Governing Council, which had given a third deadline to Kochi last week after the consortium's investors reached a last-minute agreement over their shareholding pattern, on Sunday approved their ownership structure and took it in its fold."At their meeting today, the IPL Governing Council confirmed that the Kochi Franchisee had satisfactorily responded to the notice issued to them by the BCCI, and decided that the franchisee Kochi Cricket Pvt Ltd, would play in the IPL from 2011 onwards," BCCI Secretary and President-Elect N Srinivasan said in a release.BCCI vice-president Rajiv Shukla said the Board's legal team was satisfied with the ownership structure of Kochi franchisee."Today, the Governing Council decided to approve Kochi as the eighth franchise of IPL and it will play in IPL 4. This decision was taken after examining the shareholding pattern Kochi submitted and the response (to the notices) they had g4en to the BCCI. It was legally examined. The GC found it appropriate," Shukla told reporters in Delhi.The Governing Council's decision comes on the backdrop of the legal developments involving the BCCI and expelled IPL franchisees - Kings XI Punjab and Rajasthan Royals.Relieved by BCCI's decision, Satyajit Gaikwad, CEO of Rendezvous Sports World Pvt Ltd that represents the promoter group, said the the franchisee will now get down to business to build the side for the Twenty20 event."Differences (in the franchisee) are now things of the past. Earlier we were consortium partners. Now we are a family of IPL Kochi Private Limited," Gaikwad said."We will have a Board meeting as soon as possible, may be tonight or tomorrow to decide the future course of action and team building. We are very sure that we will rise up to the expectations of cricket fraternity of Kerala and India," he said. Gaikwad said that Rendezvous held only sweat equity and it was not paid up (equity shares given without receiving payment for effort).Mukesh Patel of Parinee Developers, one of the investors in the franchisee, expressed happiness over the BCCI's decision and said that there were no problems in the franchisee now."There were some internal issues. There are differences of opinion in every company. But that has now been sorted out. Now we will work as a team," said Patel who was here for the IPL Governing Council meeting.Refusing to divulge the new share-holding pattern of the outfit, Patel said its managing committee will now take decisions related to its future operations.Barely seven months after becoming the second most costliest team in the Indian Premier League, Kochi was on the verge of being thrown out of the event.But the owners of the beleaguered franchise made a last ditch attempt to save the outfit by reaching a compromise.Before the compromise, the investors of the franchise, which was bought for a staggering sum of Rs 1533.33 crore, had written to the BCCI informing them of their intention to withdraw from the IPL.That letter was sent after the BCCI, which had on October 10 expelled Kings XI Punjab and Rajasthan Royals for allegedly violating contractual agreements, gave a termination notice of 30 days to the franchise to sort out internal disputes regarding the shareholding pattern.The investors in the consortium - Anchor Earth, Parinee Developers, Rosy Blue and Film Wave - had earlier held 74 per cent of the equity.The remaining 26 per cent was with the Gaikwad family - Shailendra, his brother Ravi and their parents, all part of Rendezvous Sports World - as free equity for services rendered while bidding.It was this 26 per cent which became a bone of contention among the stakeholders as the investors were in no mood to give free equity to the Gaikwad family.The Gaikwads, on their part, initially refused to part with the equity but later agreed to accept just 10 per cent sweat equity after the investor group threatened to pull out of the franchise."We (Rendezvous) have done everything to facilitate the team to survive," Gaikwad said.The BCCI has maintained that eight teams will take part in the fourth edition of the league scheduled from April 8, just six days after the World Cup.However, this looks uncertain as Justice B N Srikrishna, the arbitrator appointed by the BCCI and Rajasthan Royals to resolve their case, stayed the termination of contract of the Royals after terming it illegal on November 30.The Cricket Board has moved the Bombay High Court against the arbitrator's stay.In the case of Kings XI, Justice Srikrishna recused himself from the proceedings as the BCCI expressed reservations after he disclosed that he had once represented (as a lawyer) Bombay Dyeing, whose owner Ness Wadia has a stake in Kings XI.The Bombay High Court has also extended the deadline for the IPL franchisees to sign up their respective "marquee" players till December 8.
In a dramatic turnaround, the Kochi franchise it seems has survived the axe as of now and will take part in the fourth edition of the Indian Premier League, to be played in 2011.Sources have told NDTV that the owners of the Kochi franchise have come to an amicable settlement over the sweat equity issue and hence have now sorted out their differences.Satyajit Gaikwad, CEO of the franchise told NDTV that they have given a few options to the BCCI and are now awaiting its response.The final decision will be taken by the IPL Governing Council which is presently meeting in Nagpur.Till yesterday it was believed that the Kochi franchise would not be allowed to participate in the IPL 4 and the BCCI would float a new bid for an eighth team as the owners had not been able to settle their differences over the ownership pattern.The 30-day deadline given by the BCCI to the franchise owners expired on Saturday and the investor group of the franchise, which was bought for a staggering sum of Rs. 1533.33 crore, had written to the BCCI informing them of their intention that they wanted to withdraw from the IPL two days before the expiry of the 30-day notice period, issued to them by the Cricket Board to sort out their internal differences.According to the initial set up, the investors in the consortium -- Anchor Earth, Parinee Developers, Rosy Blue and Film Wave -- hold 74 per cent of the equity.The remaining 26 per cent lies with the Gaikwad family -- Shailendra, his brother Ravi and their parents all part of Rendezvous Sports World -- as free equity for services rendered while bidding.BCCI vice-President Rajiv Shukla had said the Board has received "certain letters" from the consortium's stakeholders.
The Kochi IPL franchise saga took a new turn on Sunday as the BCCI deferred its decision on the franchise's fate to December 5. The IPL Governing Council which met in Nagpur on Sunday was supposed to take a final decision on Kochi's fate, but has now decided to extend the deadline as the owners have come to some sort of a settlement."They have disclosed their ownership pattern. Our legal experts will study the papers. There was no discussion with the investors because we are not legal experts. BCCI will take a decision on December 5 in Mumbai," BCCI President Shashank Manohar told reporters after the meeting.Till Saturday it seemed that the franchise's future was doomed with many of the investors writting to the BCCI, clearly mentioning that they wanted to withdraw from the Indian Premier League.With the 30-day deadline to sort out the sweat equity matter ending without any proper response from the Kochi owners, indications were there that the BCCI will scrap the franchise and float a new bid for the eighth IPL team which would participate in the 2011 edition of the cash rich T20 leage.But hours before the meeting, the owners of the franchise were able to arrive at an amicable settlement and thus forwarded a few options to the BCCI.Satyajit Gaekwad, the acting CEO of the franchise told NDTV that they have reached a consensus and the following options have been forwarded to the BCCI.
According to the present shareholding pattern, the investors in the consortium -- Anchor Earth, Parinee Developers, Rosy Blue and Film Wave -- hold 74 per cent of the equity.The remaining 26 per cent lies with the Gaikwad family -- Shailendra, his brother Ravi and their parents all part of Rendezvous Sports World -- as free equity for services rendered while bidding.It is this 26 per cent which became a bone of contention among the stakeholders as the investors were in no mood to give free equity to the Gaikwad family.
In the new formula worked out by the owners, the Gaikwad family has agreed to bring down their equity stake from 26% to 10%. They are further ready to buy out 5% of the 10% equity as well.They have also reached a consensus over the control of the team with the other investors. The company will now be called the Kochi IPL Cricket Pvt. Ltd.As a result the BCCI has now decided to study the entire matter and would take a final call on the fate of the franchise on December 5.