CCI nod for Poonawalla, Westview Cricket acquisition of Rajasthan Royals, 2 overseas teams

The Competition Commission of India (CCI) has approved the acquisition of three professional cricket franchises—Indian Premier League (IPL) team Rajasthan Royals, South Africa's Paarl Royals and Barbados Royals—by Westview Cricket Ltd and Poonawalla Sports and Fitness Pvt Ltd, clearing a key regulatory hurdle for the transaction.

The competition regulator announced the approval on September 17. The transaction involves Westview Cricket, registered in the UK, and Poonawalla Sports, incorporated in India, acquiring the three-franchise cricket group.

The approval comes after the CCI had sought additional information from the parties in August on the proposed transaction. The deal, announced earlier this year, involves Rajasthan Royals and its associated overseas franchises and has been reported to have an enterprise value of about $1.65 billion.

Three-franchise acquisition

The proposed combination covers Rajasthan Royals in India, Paarl Royals in South Africa and Barbados Royals in Barbados. Rajasthan Royals competes in the IPL, the T20 cricket tournament organised by the Board of Control for Cricket in India (BCCI).

The target entities identified in the transaction are EM Sporting Holdings Ltd (EMSH) and Royal Multisport Pvt Ltd (RMPL). EMSH, incorporated and registered in Mauritius, is the holding company for RMPL, Paarl Royals Ltd and Barbados Royals Ltd. RMPL owns and operates the Rajasthan Royals franchise.

The acquiring entities are Westview Cricket and Poonawalla Sports.

Westview Cricket is registered in the UK, while Poonawalla Sports is an Indian private limited company wholly owned by Adar Cyrus Poonawalla.

Mittal-Poonawalla ownership structure

Westview Cricket is the investment vehicle through which the Lakshmi Mittal family is acquiring its interest in the franchise group, while Poonawalla Sports is the vehicle for Adar Poonawalla's investment.

The proposed transaction had earlier been reported as involving a 75% stake for the Mittal family through Westview Cricket and an 18% stake for Poonawalla Sports, with existing shareholders retaining the balance 7%.

The transaction follows an earlier proposed sale of the franchise group that did not go through. The acquisition announced in May valued the business at around $1.65 billion, according to earlier reports.

CCI had sought additional information

The latest approval follows the regulator's request in August for additional information from the parties. At the time, the CCI had sought further details on the proposed combination after finding that the information submitted with the filing was incomplete.

In their filing, the acquirers had submitted that they were not engaged in businesses that overlap with those of the targets or their affiliates in India in any plausible relevant market. They consequently said the transaction was not likely to result in an appreciable adverse effect on competition in India.

The CCI's approval now removes the competition-law hurdle for the transaction.

Rajasthan Royals at the centre of cricket franchise investment

The transaction adds to the growing value and institutional interest surrounding cricket franchises, particularly IPL teams, as investors look to build portfolios across multiple T20 leagues.

For the Mittal family and Poonawalla, the proposed acquisition also provides exposure to cricket franchises across three markets: India's IPL, South Africa's franchise T20 ecosystem and the Caribbean's professional cricket league.

The acquisition still involves other applicable approvals and closing conditions before the ownership transition is completed.