Promoters agree to reduce stake, board to run team

The two big changes to the ownership structure of the consortium that bought the Kochi franchise are a reduction of the promoters' holding from 26% sweat equity to 10% free equity, and the appointment of a board to run the operations of the team. The changes allowed the franchise to resolve its ownership dispute and stay in the IPL.

The 16% that has been taken from the promoters, Rendezvous Sports World Pvt. Ltd. (RSWPL), will be distributed equally amongst the remaining partners of the franchise in the proportion of their existing shareholding. The consortium will also appoint a board for Kochi Cricket Pvt. Ltd., the new company that will take ownership of the team, and its members will come from all its partners: Anchor Group, Parinee Developers, Anand Shyam Estates, Rosy Blue and RSWPL.

Satyajit Gaikwad, head at RSWPL, and the man who was involved in the arm wrestling with the investor group, sounded positive yet weary. "Earlier we were people who were the run the show. But now there is a board which will run the show," he said. When asked what had forced him to acquiesce to the demands of the investors, who remained adamant throughout the process that they were unwilling to accept anything but the cut in RSWPL's stake, Gaikwad sidestepped the query and instead said it was important to keep the game in mind. "We did it for the bigger interest of the game and for the people of Kerala."

Though the BCCI has accepted the new agreement, some insiders privy to the matters still fear that the Kochi issue will come back to haunt the BCCI. One board official said that the board had found itself, surprisingly, in a spot of bother after Justice Srikrishna's order restoring the Rajasthan Royals to the IPL on November 30. "More than Kochi being a in a fix, the BCCI was in a fix," the official said.

The other danger, he said, was that the pillars the Kochi consortium stood on were far from strong. "Some of the investors are not very deep pocketed. They would not be able to go for more than two IPLs."

Also tabled at the meeting, by the board's lawyers, was their explanation on how Kochi's case is different from those of Rajasthan and Kings XI Punjab. "There is only a written opinion that came from the BCCI lawyers. Their opinion was that there is only an alteration among the percentage of shareholding within the same people who originally held it. So technically there was no transfer where a new party was found in the case of the other two teams," the official said. "And in the case of Kochi owners nobody has changed from the minority to a majority position. So there has been no even that has taken place as defined in the BCCI contract which required termination."