Diageo Plc, which owns Royal Challengers Bengaluru (RCB) via United Spirits, on Tuesday clarified on media reports suggesting a potential stake sale in the IPL cricket franchise.
According to a Bloomberg report, the British distiller has been holding discussions with potential advisers as it weighs possibilities including a sale of part or all of the club.
The report, which cited sources, also claimed that Diageo is seeking a valuation of nearly $2 billion.
These discussions were said to be a result of the Indian health ministry efforts to prohibit the promotion of tobacco and alcohol brands in the IPL, along with curbing the indirect promotion of other unhealthy products by sports personalities.
While explicit advertising of tobacco and liquor products is banned in India, companies like Diageo have found ways to promote other products, such as soft drinks, through high-profile cricketers.
RCB, one of the founding teams of the IPL, was initially owned by Vijay Mallya, a beer tycoon whose Kingfisher Airlines Ltd. collapsed in 2012 due to unpaid debts. Diageo later acquired RCB as part of its purchase of Mallya’s spirits business. Recently, RCB celebrated its first IPL championship victory, with star player Virat Kohli boasting one of the largest social media followings among athletes worldwide.
As the IPL’s valuations continue to surge, team ownership has become one of the most coveted assets in the sports industry. A sale of RCB could establish a new benchmark for future transactions in what is now recognized as one of the fastest-growing sports leagues globally.
The IPL has transformed into a massive entertainment and advertising platform, rivaling the National Football League and the English Premier League in commercial stature.
The league’s fast-paced, three-hour matches attract hundreds of millions of viewers both in India and internationally.
