New Delhi: Owners of Rajasthan Royals, the team that won the inaugural Indian Premier League (IPL) cricket tournament, have sold a 12% stake to London-based entrepreneur Raj Kundra and his partner, Bollywood actor Shilpa Shetty, in a deal that values the Jaipur franchise at $140 million (about Rs680 crore) .
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At that valuation, the stake bought by the two would be worth $16.8 million. “This is a significant valuation given that we had bought the team for $67 million,” said Raghu Iyer, chief marketing officer, Rajasthan Royals.
A big chunk of the new investment will be used to fund new marketing initiatives, which include a DVD that documents the team’s rise to fame in season one of IPL, and a Bollywood film featuring Rajasthan Royals. The money will be used to procure new players and stage matches with local clubs in the UK and in Australia.
Owners’ pride: (L to R) Vice chairman Ravi Krishnan, Raj Kundra, Shilpa Shetty and Manoj Badale at the Mumbai press conference. Santosh Hirlekar / PTI
“The selling of this stake is part of our long-term strategic approach to build the Rajasthan Royals into a global sports brand,” said Manoj Badale, chairman, Jaipur IPL Cricket Pvt. Ltd, owner of the franchise.
He added that the investment would enhance the “off-field commercial potential of a brand already recognized throughout India and much of the global cricketing world.”
“Last season was very much about cricket and conquering the hearts of people in India… season two will be about conquering our global ambitions,” Badale said.
Kundra is chief executive of Essential General Trading LLC, a Dubai-based trading company dealing in precious metals, construction, mining and green renewable energy projects. Shetty has invested in the venture in her capacity as the chief executive officer of S2 Global Productions Pvt Ltd., which is her home film production company.
“It’s a strategic business investment. I always support the underdogs as I am myself one. Rajasthan Royals were the underdogs in IPL before they succeeded (in winning the title)”, Shetty told a media conference held in Mumbai on Tuesday. Some reports recently said Rajasthan Royals was looking at raising funds through an initial public offering. Iyer said the funds raised from the stake sale will take care of the team’s immediate capital requirements. “We aren’t looking for a listing right now, but it isn’t ruled out for future,” Iyer added.
Graphics by Sandeep Bhatnagar / Mint
(PTI contributed to this story.)