Chaos galore, but IPG wants contract extended
The event rights holder of the Lanka Premier League (LPL) wants five years of matching rights for the tournament at the conclusion of the current five-year contract to recover their investment.
Anil Mohan, founder of IPG Group
A letter sent by Anil Mohan, the founder of the Dubai-based The IPG Group, who owns the event rights up until 2024, claims the company has incurred a massive loss of US$ 2.4mn, around Rs 500mn, despite SLC waiving off of US$ 154,298.8 (Rs 31.4mn) received as central pool revenue and stepping up to bear half the PCR tests costs amounting to Rs 15mn.
“The loss incurred by IPG in the first edition could take at least up to the 4th year to recover and it is in the 5th year that we hope to break even or start turning the corner on the bottom line,” the letter signed by Mohan reads.
“Hence, the opportunity to have the matching rights would help IPG to be financially viable with its investment in the LPL at the end of the next five years, and therefore, we request your kind consideration in that regard.”
Mohan denied sending an official request when questioned at the LPL launch press conference on Wednesday in a five star hotel in Colombo, but the letter in possession of the Sunday Times shows he first suggested it as far back as September 29, 2021, to the SLC President.
“Though the IPG group was able to deliver an excellent product in the 1st edition, I am sure you are aware that the cost of doing so was a staggering loss of approximately US$ 2.4mn which we inherited. The only reason the IPG was able to absorb this loss was due to it valuing the brand LPL and the relationship it has with SLC and the desire to build the Brand LPL even bigger, though the problem the loss created in the form of liquidity to the organization was most trying,” the letter reads.
SLC officials said they are yet to consider IPG’s request.
According to documents, SLC has received US$ 154,296.8 from the central pool revenue which includes 10% from the total broadcasting rights fee of US$ 126,238, 10% from the ground right fee of US$ 1,396,730 and 20% from total digital rights income amounting to US$ 10,000.
This amount has been waived off after IPG requested SLC to offer them a relief off the said amount as they were deprived of revenue from ticket sales since the tournament was played behind closed doors. However, in order to avoid queries from the Government auditors, the SLC Executive Committee has decided to keep the Sports Minister informed. SLC is audited by the National Audit Office, a requirement under the Sports Law. They also want SLC to waive off the same, excluding the digital rights from the current season.
In relation to digital rights, SLC has agreed to give IPG the exclusive digital rights (within the territory of Sri Lanka) for the second edition onwards subject to it agreeing to pay SLC a sum of US$ 35,000 if the digital rights revenue is below US$ 100,000 and 35% of the revenue if the revenue is above US$ 100,000.
The Sunday Times on numerous instances have highlighted that the IPG Group has delayed honouring their contractual obligations by not settling the event rights fee in full by the due date. They have delayed paying a balance of US$ 725,000 for months but the IPG head on Wednesday said they recently paid the amount in full including part of the fee for this year.
SLC were to receive US$ 1,925,000 during the first two years according to the bid documents and a 11% incremental increase from the third year. The SLC will also absorb the anti-corruption fee which IPG paid last year from the second year onwards, considering it an operational expense.
The second edition of the LPL will begin this afternoon at the R. Premadasa Stadium–the venue for the qualifying round before four semi-finalists will move to Hambantota for the knockout stage of the tournament.
| Former Viikings owner slams IPG | |
 Sachiin Joshi Several months after their franchise was terminated, the owner of the Dambulla Viikings Sachiin Joshi, who participated in the first edition of the Lanka Premier League (LPL) awaits justice over what they termed as ‘an illegal termination of the franchise agreement’. Appearing in a virtual press conference, several weeks after being granted four months temporary bail in connection with a money laundering case, the Bollywood actor said that the Innovative Production Group (IPG), the event rights holder of LPL, had illegally terminated the franchisee agreement without providing them a fair chance to rectify the breach of agreement, which resulted in heavy financial and reputational damages to them. Asked whether the ongoing criminal investigation on him had an impact on the termination of his franchise, Joshi said it should not, as the matter is still under probe, but IPG head Anil Mohan said it was this reason that compelled him to terminate the franchise in addition to not paying the remainder of the franchise fee. “If I have to look at ‘compliance’, we were hell bent on having an agreement before we started. But based on their assurance we just went ahead with putting our faith in the league and IPG. But by the time the agreement came in –that was probably after the league–and whatever they committed to us before the league and what came into the agreement was a shocker to us as well,” Joshi explained, when questioned by the Sunday Times. “So under the ‘non-compliance’, they are holding up on the point that I need to pay another US$ 150,000 dollars against the franchise fee. Wherein IPG had told us they will share 8% of their revenue. Technically they were negotiating their fees which were not on the record. They decided themselves and came up with a number that was not committed to us. And they come up with a number that this is what I have to pay. They did not give clarity as to what my revenue is going to be. So they tried to square off.” Joshi said they are exploring the possibilities of taking legal actions but with no agreement signed, Joshi’s Telegu Warriors Sporting Adventure Private Limited in a bad footing. Joshi has invested around US$ 900,000 for the first edition out of which US$ 300,000 as franchise fees. The Jaffna Stallions, the winner of the inaugural edition of the LPL faced the same fate as their ownership was terminated citing non-compliance which the owners have refuted but are yet to challenge. “So until now, till about last week, they were communicating and they were saying that ‘Please take on Kandy Tuskers’.” “That was their last communication. We are a professionally run company –you come up first with the theory ‘OK’, Dambulla sold out so you take on Colombo. “Then you come up with the theory ‘OK’, Colombo is not there why don’t you take Kandy Tuskers?” Then they come up with the story that ‘OK’, Kandy Tuskers are fine. But why don’t you take clearances from ICC. I don’t understand why they keep coming up with different replies every single time. Why can’t they stick to their stand-which is they want to terminate my agreement.” “If that is the case, they want to terminate me as a company from participating in the league, why are they doing all these false communications? So finally we decided that we don’t want to go through with this process-or the games that they are playing with us as a company,” he added. |