The Indian Premier League (IPL) Royal Challengers Bengaluru (RCB) team is owned by Diageo India, the Indian division of UK-based Diageo Plc. The company has refuted rumors that it intends to sell its ownership interest in the team.
In a letter to the Bombay Stock Exchange (BSE) and the BSE Surveillance Department on Tuesday, June 10, Diageo India reiterated that the media allegations about the purported transaction are only hypothetical.
“The company would like to clarify that the aforesaid media reports are speculative in nature, and it is not pursuing any such discussion. This is for your information and records,” said Mital Sanghvi as quoted by Cricbuzz.
The shares of Diageo’s Indian affiliate, United Spirits, have increased since rumors of a possible sale of the RCB franchise appeared, one week after they won their first Indian Premier League title. Diageo is listed on the Bombay Stock Exchange (BSE).
Discussions in the market on Tuesday intensified after Bloomberg revealed that Diageo is looking into options to sell RCB. The announcement came after RCB won the IPL for the first time since the league’s founding in 2008. On June 4, however, the triumph festivities in Bengaluru took a tragic turn as 11 people were killed and numerous others were hurt.
“Being a public company, there will be a lot of pressure on reputational damage,” said a noted voice on the sports ecosystem in the country with a thorough knowledge of the IPL landscape.
Diageo is reportedly considering valuing the RCB, one of the eight original IPL teams established by Vijay Mallya in 2008, at USD 2 billion. The Gujarat Titans (GT), which Torrent purchased for INR 7,500 crore, or around $1 billion, were compared.
However, IPL founder Lalit Modi thinks that RCB’s staggering USD 2 billion valuation is appropriate. Noting that GT’s estimate was based on a one-year-old agreement, he said he wouldn’t be shocked if RCB was sold for much more money.
“No decision is final, and they may decide against selling the team, the people said, asking not to be named as the details are private,” said the Bloomberg report.
