Commenting on the bidding process, Ronnie Screwvala, owner of U Mumba, told ET, “U Mumba will look to sell its team ownership in PKL league. Nepotism played out to a sham auction.”
A day after Mashal Sports, the owner and organiser of Pro Kabaddi League (PKL), announced Star & Disney India as the winner of the league’s media rights for the next five seasons, some team owners have voiced objections over the entire auction process that did not see bidding from anyone apart from Star & Disney India.
These team owners have referred to what they term as a conflict of interest on the part Star & Disney India, which owns 74% in Mashal Sport, as one of the main reasons behind this.
Mashal Sports had kept the reserve price for the consolidated rights at Rs 900 crore for five years. As no other participant bid, Star & Disney India placed the sole bid of Rs 905 crore to retain the rights.
Apart from Star & Disney India, five more companies - Sony Pictures Networks India (SPN), Dream11, Reliance, Cartamedia and iTW picked up the tender.
Commenting on the bidding process, Ronnie Screwvala, owner of U Mumba, told ET, “U Mumba will look to sell its team ownership in PKL league. Nepotism played out to a sham auction.|
He added, “The erstwhile high fee earning consultants involved need a standing ovation for running the most successful auction ever where NO bidder (other than the owner of the league) turned up for the second most popular sport in India. But who will hold anyone accountable. It's disappointing that by selling off a great Indian sport to a global media company the true potential has been capped forever.”
Screwvala alleged that league owner Mashal Sport was conflicted by its ownership and even “failed to timely disclose complaint letters” received by potential bidders that the tender process was “biased to favor broadcasters” eliminating all tech and new age companies to even enter a bid.
"On a lighter note - If i get sued for my above comments I’d be happy to lay bare the origin of conflict and nepotism,” Screwvala added.
Mashal Sports emphasised that the entire process was transparent and a big success. The process was overseen by an independent auction committee comprising Justice (retd) AP Shah, former DGP Mumbai AN Roy, and noted commentator Charu Sharma.
“In no other league, eight out of the 12 franchises will turn profitable in the eighth season. This auction saw the annual payout of broadcasters doubling from last season,” Anupam Goswami, CEO, Mashal Sports and League Commissioner of PKL told ET. “We had formed an independent committee, which oversaw the fair and impartial auction.”
Star & Disney India’s average annual payout will be Rs 181 crore per season, which will ensure every franchise gets Rs 12 crore per season as Mashal Sport will put in 80% of the media rights money in the central revenue pool.
Goswami added that PKL has set an example for the industry by adhering to a public auction and setting a completely new standard of transparency.
When asked if Rs 905 crore is the right value of the rights for the property, Goswami said that if there would have been more players, the story could have been different.
“If there would be more participants, maybe we could have had a higher value,” he added. “If we had a lower base price, maybe they would have enough room to build a momentum.”
Mashal Sports was founded by Anand Mahindra and Charu Sharma in 1994, however, it took the company almost two decades to get a broadcaster on board to launch PKL.
It was only in 2014, when Star India came on board and the first season of PKL was launched.
Later, in the midst of the very first season, Star India took majority control in the company.
As part of its understanding with the eight founding teams, Star India agreed to tender all rights to the League in 2020 for a fresh period of 10 years, i.e. from 2020 to 2030.
Team owners do agree that it wouldn’t have been possible for PKL to be the second largest league in the country if not for Star’s marketing might.
“Star did a good job in the first years of popularising kabbadi,” said Rajesh Shah, owner of the three-time PKL winner Patna Pirates. “The PKL media rights auction, despite there being strong interest from capable entities to participate, failed in discovery of its true market value as no one other than Star bid.”
Shah added that “Star & Disney India could consider diluting its stake in the league.”
Meanwhile, some team owners also blamed process partners for failing to attract other bidders.
Mashal Sports had signed EY as process partner and MJunction as auction partner. While the company kept the marketing of the tender with itself, Cyril Amarchand Mangaldas wrote the tender document.
“Mashal and EY failed to come up with a competent process to attract any bidder other than Star,” said Srinivas Sreeramaneni, owner of Telugu Titans. “Hopefully, the teams will continue in the sport and this will take the sport forward and benefit the players, federation and the sport.”
"Marketing the auction and soliciting of bids was not a part of our scope," said an EY spokesperson. "We were engaged to be a process advisor to the PKL media rights e-auction, which was conducted based on an agreed scope to review and operationalise a robust auction process, including managing and validating the bids received. The entire process was also overseen by an independent auction committee."
These team owners have referred to what they term as a conflict of interest on the part Star & Disney India, which owns 74% in Mashal Sport, as one of the main reasons behind this.
Mashal Sports had kept the reserve price for the consolidated rights at Rs 900 crore for five years. As no other participant bid, Star & Disney India placed the sole bid of Rs 905 crore to retain the rights.
Apart from Star & Disney India, five more companies - Sony Pictures Networks India (SPN), Dream11, Reliance, Cartamedia and iTW picked up the tender.
Commenting on the bidding process, Ronnie Screwvala, owner of U Mumba, told ET, “U Mumba will look to sell its team ownership in PKL league. Nepotism played out to a sham auction.|
He added, “The erstwhile high fee earning consultants involved need a standing ovation for running the most successful auction ever where NO bidder (other than the owner of the league) turned up for the second most popular sport in India. But who will hold anyone accountable. It's disappointing that by selling off a great Indian sport to a global media company the true potential has been capped forever.”
Screwvala alleged that league owner Mashal Sport was conflicted by its ownership and even “failed to timely disclose complaint letters” received by potential bidders that the tender process was “biased to favor broadcasters” eliminating all tech and new age companies to even enter a bid.
"On a lighter note - If i get sued for my above comments I’d be happy to lay bare the origin of conflict and nepotism,” Screwvala added.
Mashal Sports emphasised that the entire process was transparent and a big success. The process was overseen by an independent auction committee comprising Justice (retd) AP Shah, former DGP Mumbai AN Roy, and noted commentator Charu Sharma.
“In no other league, eight out of the 12 franchises will turn profitable in the eighth season. This auction saw the annual payout of broadcasters doubling from last season,” Anupam Goswami, CEO, Mashal Sports and League Commissioner of PKL told ET. “We had formed an independent committee, which oversaw the fair and impartial auction.”
Star & Disney India’s average annual payout will be Rs 181 crore per season, which will ensure every franchise gets Rs 12 crore per season as Mashal Sport will put in 80% of the media rights money in the central revenue pool.
Goswami added that PKL has set an example for the industry by adhering to a public auction and setting a completely new standard of transparency.
When asked if Rs 905 crore is the right value of the rights for the property, Goswami said that if there would have been more players, the story could have been different.
“If there would be more participants, maybe we could have had a higher value,” he added. “If we had a lower base price, maybe they would have enough room to build a momentum.”
Mashal Sports was founded by Anand Mahindra and Charu Sharma in 1994, however, it took the company almost two decades to get a broadcaster on board to launch PKL.
It was only in 2014, when Star India came on board and the first season of PKL was launched.
Later, in the midst of the very first season, Star India took majority control in the company.
As part of its understanding with the eight founding teams, Star India agreed to tender all rights to the League in 2020 for a fresh period of 10 years, i.e. from 2020 to 2030.
Team owners do agree that it wouldn’t have been possible for PKL to be the second largest league in the country if not for Star’s marketing might.
“Star did a good job in the first years of popularising kabbadi,” said Rajesh Shah, owner of the three-time PKL winner Patna Pirates. “The PKL media rights auction, despite there being strong interest from capable entities to participate, failed in discovery of its true market value as no one other than Star bid.”
Shah added that “Star & Disney India could consider diluting its stake in the league.”
Meanwhile, some team owners also blamed process partners for failing to attract other bidders.
Mashal Sports had signed EY as process partner and MJunction as auction partner. While the company kept the marketing of the tender with itself, Cyril Amarchand Mangaldas wrote the tender document.
“Mashal and EY failed to come up with a competent process to attract any bidder other than Star,” said Srinivas Sreeramaneni, owner of Telugu Titans. “Hopefully, the teams will continue in the sport and this will take the sport forward and benefit the players, federation and the sport.”
"Marketing the auction and soliciting of bids was not a part of our scope," said an EY spokesperson. "We were engaged to be a process advisor to the PKL media rights e-auction, which was conducted based on an agreed scope to review and operationalise a robust auction process, including managing and validating the bids received. The entire process was also overseen by an independent auction committee."
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