The Tata Group, one of India’s largest business conglomerates, will replace Chinese mobile maker Vivo as the title sponsor of the Indian Premier League for the next two years.
As per reliable sources, Tata will pay around Rs 670 crore for the two-year title sponsorship, while Vivo will pay a total of Rs 454 crore for terminating the contract, which makes it a win-win situation for the BCCI as it is set. To earn Rs 1124 crore for the season 2022 and 2023 respectively.
,‘Yes, Tata Group is coming as IPL title sponsor’ IPL chairman Brijesh Patel confirmed the development to PTI.
BCCI Secretary Jay Shah welcomed the company in its new role.
“This is indeed a momentous occasion for BCCI IPL as the Tata Group is the epitome of global Indian enterprise, with a 100-year-old heritage and operations in over 100 countries across six continents.” Shah was quoted as saying in a media release.
It is learned that the Tata group may continue to be the title sponsor for the 2023 season of the IPL as it was a one-year concession since Vivo lost the sponsorship season in 2020.
Vivo had struck a Rs 2,200-crore deal for title sponsorship rights from 2018-2022, but after the Galwan Valley military face-off between Indian and Chinese army soldiers in 2020, the brand had to wait for a year seeing public backlash. Took a break Dream11 replaced it in IPL.
Although Vivo was back as a sponsor of the IPL in 2021, even as speculation swirled that the company was looking to transfer the rights to a suitable bidder and the BCCI approved the move .
Reliable sources in BCCI have revealed that the board will earn Rs 547 crore in 2022 and Rs 577 crore in 2023.
As per available information, Vivo had promised Rs 996 crore for the two-year title sponsorship (2022 and 2023) with Rs 484 crore in 2022 and Rs 512 crore next year.
The price went up as the IPL expanded to a 10-team event, featuring 74 matches instead of 60 this year with eight teams.
So how does the Rs 1124 crore windfall break-up work for the BCCI?
Tata will pay Rs 670 crore at the rate of Rs 335 crore per annum. Of this, Rs 301 crore would be the rights fee and an additional Rs 34 crore would be the incremental fee (for enhancement of 14 games). But since Vivo has decided to terminate the contract, it will have to pay the difference in both the years – Rs 183 crore for 2022 and Rs 211 crore for 2023. Apart from this, Vivo will also have to pay a 6 percent assignment fee. Both the years which became Rs 29 crore in 2022 and Rs 31 crore in 2023.
So overall, Vivo will exit the sponsorship deal by paying Rs 454 crore, which is a little over a year of sponsorship money originally made by the company.
This is a big deal for Tata as they are getting great sponsorship rights for the next two years at a low cost. The biggest winner is BCCI, which stands to earn from both the new sponsor as well as the outgoing one.
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