IPL news

Pune Warriors pull out of IPL

ESPNcricinfo staff

May 21, 2013

Comments: 58 | Text size: A | A

T Suman got the big wicket of Chris Gayle, Pune Warriors v Royal Challengers Bangalore, IPL 2013, Pune, May 2, 2013
Sahara India, owners of the Pune Warriors franchise, pulled out of the IPL for a second time © BCCI
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Sahara India, owners of the Pune Warriors franchise, have pulled out of the IPL over financial differences with the BCCI stemming from the valuation of the annual franchise fee it has to pay. The decision, the latest crisis to hit the IPL, comes three years after it bought the Pune franchise for $370 million - the highest price paid for any of the IPL franchises.

It seems the immediate cause was the BCCI's decision to cash the bank guarantee from Sahara that that it was obliged, under its contract, to furnish at the start of each season. The guarantee is equivalent to the amount to be paid annually to the BCCI and can be cashed in case a franchise fails to honour its commitments.

In this case, Sahara had furnished a bank guarantee worth Rs 170.2 crore (approximately $30 million). Since the deadline for paying the franchise fees was May 2, the BCCI waited till Sahara's IPL 6 commitments were over and cashed the guarantee on May 20.

Reacting to the development, IPL chairman Rajiv Shukla said the board cashed the bank guarantee according to the rules. "Yes, it (Pune Warriors) has pulled out. As per the rules and procedure of the BCCI if a franchise fails to pay the fee then we cash the franchise's bank guarantee. We are extremely sad by their decision to pull out. This should not have happened," Shukla said.

Pune Warriors finished eighth in the current IPL season, winning four out of their 16 matches.

Franchises' troubled history

  • Deccan Chargers - Terminated on September 14, 2012 due to financial problems as the owners were unable to service their debt obligations to lenders, eventually leading to its attempted sale and dissolution.
  • Pune Warriors - Owners Sahara India had cut its ties with the BCCI on February 4, 2012, withdrawing sponsorship from the Indian team and ownership of the franchise. However, the two patched up later, ending the dispute by issuing a joint statement.
  • Kochi Tuskers Kerala - Terminated on September 19, 2011 for breaching the terms of agreement - their inability to furnish a new bank guarantee for 2011.

This is the second time Sahara have pulled out of the IPL; they quit on the day of the 2012 auction and withdrew from sponsorship of the Indian team.

This time, though, Sahara will continue its sponsorship of the Indian team until the end of December 2013, when their present contract expires. "We share an excellent relationship with the players and will not want such dedicated and good human beings who serve the country so committed to get harmed financially due to unsporting attitude of BCCI. So we have given time to BCCI to get the new sponsorship in place from January 2014."

Sahara's actual franchise fee has been a contentious issue ever since they bought the Pune franchise for Rs 1702 crore ($370 million) in March 2010. Sahara had been demanding that the franchise fee from their original agreement should be recalculated since the minimum matches per year have been reduced to 14 from the 18 promised to them.

In a lengthy statement, Sahara detailed its dispute with the BCCI over franchise fees. It said it was "disgusted" by the BCCI's attitude towards it and would not rejoin the league even if the entire franchise fee was waived.

"In 2010, Sahara had bid Rs 1700 crore for the IPL franchise on the basis of revenue calculation on 94 matches. But we got 64 matches only," it added.

"We and the Kochi team [also bought at the 2010 auction] immediately protested and requested the BCCI to reduce the bid price proportionately for viable IPL proposition. Nothing was heard. We waited with confidence that such a sports body should have sportsmanship spirit," it said.

© ESPN Sports Media Ltd.

Posted by   on (May 27, 2013, 4:18 GMT)

Money creates crisis after crisis. Never ending lust. This is just the tip of the iceberg. Just as much IPL has given livelihood to cricketers it has given problems to cricket boards of other countries. BCCI is unjustifiably dominating world cricket purely because of money generating power.

Posted by 777aditya on (May 24, 2013, 6:41 GMT)

Good riddance! Pathetic, Poor, Pointless, Pedestrian, Painful, Pale, (P)une deserved every bit of this disgraceful exit after bagging the wooden spoon twice in as many attempts. Only lament, if any, would be they will not be able comp(l)ete a hat-trick of utter shameless, spineless, hopeless, and hapless performance next year. This team sure was a statistical delight of unknown nadirs. This team will finish last even if competes alone!

Posted by symsun on (May 22, 2013, 13:56 GMT)

@anki10688 i believe only 20% of the tickets are bought by fans, 80% of the seats are filled by those free tickets given to sponsors and other clubs.

Posted by anki10688 on (May 22, 2013, 13:27 GMT)

best thing is dont watch any ipl matches in stadium. let them sort out their problem first. then we shall support them if they are clean.

Posted by   on (May 22, 2013, 13:11 GMT)

Good for Sahara and IPL. This is inevitable since both Sahara and KTK owners did the mistake during tendering, going for such a high price to outdo all other competitors. Eventually KTK fell after a year. Sahara may be continued due to their money might and hoping for getting some consideration by applying pressure on BCCI using their Team India sponsorship status. As somebody commented if Government take over cricket administration then cricket in India will perish and corruption will flourish. Moreover like FIFA ICC also will only allow government intervention in cricket in matters related to security.

Posted by symsun on (May 22, 2013, 12:17 GMT)

I think its time for the India Government to take over BCCI under the Indian Sports Ministry, so that the revenue can be shared across the development of other sports in our country. Its disgusting that we are honoring and promoting a private body BCCI, as a Cricket Team of India. BCCI is just a private body, I dono who allowed them to represent for India. Either the government should take over Indian Cricket Team or have to own a create Team to represent for India.

Posted by CricOr on (May 22, 2013, 12:09 GMT)

Shahara start sponsoring Indian Hockey and make it compete with English Cricket which is too popular in India cause of just World Cup win

Posted by   on (May 22, 2013, 11:31 GMT)

It is important to state that Sahara has never, ever defaulted in any of its due payment in last 13 years of team sponsorship etc. We put on record that there is not a single rupee outstanding towards the sponsorship of Indian Cricket Team and BCCI is even secured by a bank guarantee against the sponsorship. The question to be asked is that what is the character of the sports body towards a company that does so much for sports in India?

Posted by   on (May 22, 2013, 11:30 GMT)

BCCI has been surrounded by controversies all along. On the other hand Sahara has done a lot for improving the standard of sport amenities in the country. Certainly Sahara did not expect such behaviour from BCCI. It is futile to speak about a sports body which lacks true commitment towards Sports and cricket.

Posted by   on (May 22, 2013, 11:29 GMT)

Sahara has rightfully claimed that they share an excellent relationship with the players and did not want such dedicated and good human beings who serve the country so committed to get harmed financially due to unsporting attitude of BCCI. This was the reason for the delay in the withdrawal, or else it would have happened pretty earlier.

Posted by   on (May 22, 2013, 11:28 GMT)

Sahara has made it clear that they will continue to work towards development of sports in the country. They will not pay heed to the unprofessional ways of BCCI. These decisions are just making way for the better things to come from the Sahara India Pariwar.

Posted by   on (May 22, 2013, 11:24 GMT)

Sahara has also made a statement that they are in the process of building a Sports Foundation, which will operate on a hub and spoke model. Whereby there will be a Central National Sports Academy with numerous regional sports academies affiliated to it. BCCI should definitely take a cue from Sahara on this.

Posted by   on (May 22, 2013, 11:20 GMT)

"We share an excellent relationship with the players and will not want such dedicated and good human beings who serve the country so committed to get harmed financially due to unsporting attitude of BCCI. So we have given time to BCCI to get the new sponsorship in place from January 2014." I respect Sahara for this, they showed that there is difference in attitude of Sahara and IPL.

BCCI is bullying everyone, if this continues, it is not good for this sport in country. BCCI should not think that they are superior to every one. If you look at the demand of PWI, it is a valid demand. They were offered 18 matches per year and only 14 matches were played, they would have bid for the team considering that in mind, what is wrong in recalculating the money?

Posted by TNAmarkFromIndia on (May 22, 2013, 10:25 GMT)

Some people are under the belief that the Pune Warriors franchise is over and done and the next season will played with 8 teams and all the PWI players including the likes of Yuvraj Singh and Bhuvneshwar Kumar among others will be sold off to other teams, and I don't think that's the case at all. I'm pretty sure BCCI is going to float a tender for the PWI team and the new owners will have the opportunity to retain any players they want before the auction starts, much like the Hyderabad franchise. Videocon had expressed it's intent to own a team in the past and they had the third highest bid in 2010 after Sahara and Rendevous, and it's very likely that they'll own the Pune team by the end of the year.

Posted by Kashi0127 on (May 22, 2013, 9:51 GMT)

@ Vamsi Mohan Kavuri VM True except for one thing. ICL was closely associated with very respected cricketer - Kapil Dev who has brought so many laurels to the country and IPL and current BCCI managed by bunch of corporate folks, entrepreneurs and politicians. It is obvious who can think good of cricket among these.

Posted by   on (May 22, 2013, 8:45 GMT)

This concept of IPL was started first by Zee group in the name of ICL. Zee group did well in organising this tournament. BCCI suddenly felt unsecured and greedy that some of the money will go away to Zee and its franchise teams,so suddenly started IPL from no where. Even put a condition that whoever play in ICL will be debarred from Ranji teams and will not be allowed to play in IPL also. So suddenly all players started withdrawing from ICL. So IPL and BCCI became ruling the cricket in India with no competitors. Anyhow Sahara group this time be firm in their decision and I request all the major companies to withdraw from this stupid tournament which is making players greedy for money and ended up in some spot fixing,etc. It is shame that BCCI is not at organising properly.

Posted by TKM-terrors on (May 22, 2013, 8:35 GMT)

It is high time to think about reducing the length of tournament. We want players from every nation to participate in IPL . It is unfair to make a team not able to play their full strength squad since players are missing the tournament due to international commitments. Since ECB requested BCCI to finish IPL before may, it makes sense for BCCI to consider it . I have a suggestion here .

Split those 8 teams into 2 groups (4 per each ) . Each team has to play 2 matches each(home and away) with remaining teams in their group. This reduces the no of league matches from 72 to 24. Top 2 from each group should qualify for the playoffs. First from each group should face in qualifier. Second placed teams should face in eliminator.

Posted by Haleos on (May 22, 2013, 8:23 GMT)

@Giridharan - IPL as a brand is causing harm to indian cricket. Look at the current schedule. IPL final is 4 days prior to India's first match in Champions Trophy. I live in UK and the jet leg lasts at least a day when coming back from India. BCCI for all its glory does not care about cricket or cricketers. Indian team should have been in England playing practice matches getting used to the conditions and not this circus. 76 matches is an overkill for a domestic league. BTW, Zero was invented by Aryabhata (An Indian) which the world can not live without.

Posted by TKM-terrors on (May 22, 2013, 8:20 GMT)

To be honest, this is what I wanted. As a fan , it is too painful to see one sided matches. One want to see exciting matches at the end of the tournament but not matches like Pune vs Delhi . Now BCCI , For Heaven sake , please dont go for new franchise. 8 is enough . Even in WorldCup , an ICC Tournament ,we dont want to see minnows just because we want to avoid one sided matches. In such a long tournament,which is even longer than a world cup(in no of matches) one dont want to see 20 or 30 one sided matches out of 72.

Posted by sweetspot on (May 22, 2013, 7:51 GMT)

This is just a bad way to do business. Both parties must have included a provision in their contract, that the sum payable is subject to a certain number of matches being played, and what should happen if lesser number of games are played. Beyond that, it is not complicated, is it?

Posted by   on (May 22, 2013, 6:44 GMT)

Everyone seems to forget that for the owners, it is ONE of a diversified portfolio of businesses, they own. All such corporate heads periodically do clean up the portfolio, by pruning the non-performing business units. Very rarely the Chairman's office and his Corporate Strategy Group discuss it with the unit managers. The unit Managers come to know post facto, or if earlier through grapevine.

BCCI also, often forget that the franchisees are not their employees.

If a McDonald franchisee in Mumbai wants to get out, he/she can, within the provisions of the contract.

The only thing the McDonalds can do, while the franchise is running, is to periodically check and ensure the quality standards are maintained and the corporate Brand Equity is not adversely hit! That is all. BCCI, in some respects, is still naive about modern business practices. That was OK in the days when they were just a sportbody. Once they decided to get into businesses like IPL, they have to learn the business norms.

Posted by vaibhavdnyan on (May 22, 2013, 6:03 GMT)

Very Unfortunate for PWI fans they were supporting their team with full strength even when they were not delivering. Hoping if not this year then atleast next year. Hope Pune franchise will get a new owner or i think their supporters should get together and own Pune franchise just like Barca.

Posted by   on (May 22, 2013, 6:00 GMT)

Its obviously a very sad end for pune warriors and more sad to pune fans including me, i totally agree with Kapil_Choudhary as the ipl 7 should stick on to 8 teams itself as there will be a variety of options to all the 8 franchises and all 8 teams can pick up variety of good players and the most interesting is that pune warriors have not lost major of their defeats badly except that game against RCB when Gayle smashed 175* in the remainder of the games they have surely fought hard, but one thing is sure all the pune warriors players are hugely talented especially in T20 like yuvraj,aaron finch,bhuvneshwar kumar,dinda,rahul sharma,robin uthappa,steve smith im sure all the franchisees will be aware of this and will be licking their fingers while the fresh auctions start next year

Posted by   on (May 22, 2013, 4:25 GMT)

Franchies owners can come up with some policy like rotating team ownerships [eventually as a replacement we saw this year e.g. SRH] not the necessary one but rotating their ownerships for a period as they do with players contract can give some way for the current issues to get controlled rather then getting solved in some other unwanted manner.

Posted by   on (May 22, 2013, 4:07 GMT)

One of the hidden causes might be the retention rule granted to IPL teams, the big teams are keeping the best player anyway and with the same bunch of players, there would be a real doubt if Pune could ever win the title.

Posted by Javed_17 on (May 22, 2013, 4:00 GMT)

Pune gone.. good riddance to bad gravy. Pune has underperformed with the names in the line up. You cannot expect 2 consecutive bottom table seasons and expect no penalties - in this case fans. Franchises have really lowered themselves because of pune. Apart from sunrisers, almost every team which beat pune lost the next match. shows u the effect of pune on lowering standards. No sadness or regrets for a bad team leaving

Posted by   on (May 22, 2013, 1:49 GMT)

How can Sahara blame BCCI for their own lost. Sahara didn't make a good squad in IPL , so it affected their franchise. Other than requesting reduction team management must be concentrated on their players and couch performances and instant changes.

Posted by squarepeg on (May 21, 2013, 22:10 GMT)

IPL should have 6 or 7 teams. One more to be dropped in KXIP. Too many teams, too long a tournament. Sahara paid too much money, and then got into problem with SEBI and Supreme Court forcing it to pay back investors. This was coming, one just didn't want to notice it. Pune will be better off if there is a more sensible owner, like the Mahindras who are big in Pune.

Posted by TNAmarkFromIndia on (May 21, 2013, 22:02 GMT)

@sachin_vvsfan There were at least two other parties bidding for the Pune franchise, so if Sahara hadn't won the bid for the Pune franchise someone else would've. The issue was never with the city as they continued to support the team even through repeated failure. The issue Sahara had was with BCCI and it would've been the case no matter which city they chose as their home. Hope Videocon acquire the Pune franchise next year.

Posted by sachin_vvsfan on (May 21, 2013, 21:18 GMT)

Good riddance. For both Sahara and IPL. I am sure BCCI will look out for some one to replace sahara. They were even looking for 10th team. But whoever it is can we have one team from North East? That will bring some parity and also helps in the development in that region.

That said Sahara IMO should have never bid for Pune in first place.

Posted by   on (May 21, 2013, 20:48 GMT)

Good Decision Pune Warriors

Posted by   on (May 21, 2013, 20:29 GMT)

Sad end for Pune Warriors....... :( .. The only IPL match we saw was As a PWI home fan at NaviMumbai Stadium in 2011.....

Posted by   on (May 21, 2013, 20:25 GMT)

It was Inevitable.................

Posted by TNAmarkFromIndia on (May 21, 2013, 20:19 GMT)

I am sure they will sell the Pune franchise next year and I'm sure someone will buy it too. The change in ownership might turn out to be good for the Pune fans just like it was for the Hyderabad franchise.

Posted by Baundele on (May 21, 2013, 19:46 GMT)

IPL should be played six months a year. So, each franchise will get enough number of matches to make money. Hopefully that will put less pressure on world cricket as well.

Posted by   on (May 21, 2013, 19:12 GMT)

thank you Pune Worriors you took the right decesion. I all are happy that you showed the guts to protest.

Posted by   on (May 21, 2013, 19:05 GMT)

As a former DC fan, I always wondered how Hyderabad was 3rd highest in team price at IPL1 when it is not a big city compared to madras, delhi, calcutta who paid between $70-90m. But they paid over $100 million only below mumbai & bangalore. Then the DC team bid on big name foreigner batsmen who never really came through much & felt the team was losing money and thats why they traded KP to delhi & ojha to mumbai but got nothing in return. They also didnt retain rohit sharma - yes he chokes a lot but there was no other indian batsmen of note on the team. But I do think pune did pay a kings ransom & within their right to demand some of their money back due to evaluation not being correct. I hope IPL has a full fresh auction so their team can go all out on big name players, player retention is boring if a team can keep its top 4 players. Limit it to 2 - 1 overseas & 1 indian. Otherwise introduce free agency like nfl/nba. Team can try to lure players with bigger contract.

Posted by   on (May 21, 2013, 18:25 GMT)

Good desicion by the Pune Team considering their perfoormaces and because of the current controversies the brand value of IPL will decrease iit will difficult for them to manage this expensive franchise.

Posted by Maddy199496 on (May 21, 2013, 18:07 GMT)

Sahara were not sharing a good relation with BCCI and this was bound to happen.Its better they include a team from UP because they have a pool of good youngsters like Ali Murtaza,Mohmmad Kaif,highest run getter of IPL Suresh Raina and many more.Kanpur should be the team replacing Pune.

Posted by IndCricFan2013 on (May 21, 2013, 17:24 GMT)

I always wondered why they did not bring this up SRH was formed for a lower fee. It makes sense and BCCI/IPL must lower their fee, it is not fair to ask pune to pay such a huge sum. If BCCI do not agree, they are better off dissolving it and buying a new franchise at a lower rate like SRH. It is a bust market ( comparability) to buy an IPL team, not a boom market for anymore. To be able sustain BCCI/IPL has no other way than agreeing or worst case dissolving and creating a new one at a lower fee.

Posted by dhonimen on (May 21, 2013, 17:04 GMT)

A better decision, Instead of two Maharashtrian franchises, it is better to have a franchise from Gujrat which have 3 ranji teams,namely,Gujrat, Saurastra and Baroda, 3 stadiums at Ahmedabad, Baroda and Rajkot and also players like pujara, jadeja, parthiv and munaf patel.

Posted by TNAmarkFromIndia on (May 21, 2013, 16:49 GMT)

I'm pretty sure the Pune franchise will bought by someone else. Maybe Videocon or the Amanora Group will buy it. The people of Pune have been very supportive of the team even through repeated failure and that should strike a chord with potential franchise owners. Besides, the Pune stadium is expected to be bigger and better by next year.

Posted by inswing on (May 21, 2013, 16:41 GMT)

8 team iPL is financially not feasible. It will be only 14 matches per team, which means even less revenue than 16 matches. With franchises already making loss, less revenue will not be acceptable to the existing franchises. I bet they want not one but two more franchises, brining the total to 10 teams and 18 matches per season.

Posted by mrbaddy on (May 21, 2013, 16:24 GMT)

We may not know the full details, but based on the Sahara Press Release assuming all of it be true, I really feel for Sahara. Even though im from Hyd, I have been a supporter of Pune Warriors throughout the last 3 years of their existence, because of the enormous costs that they had to suffer for the IPL team. (Ganguly being another reason in 2011 & 2012). Their emotional approach to things (Sponsorship money for ICC events, IPL team, Ganguly's recruitment in 2011) may have costed money, but they sure might have gained lot of hearts. I honestly believe BCCI's introspection time has come and will look forward to upcoming days with keen interest to see if BCCI's lackadaisical approach towards cricket will change.

Posted by ODI_BestFormOfCricket on (May 21, 2013, 15:49 GMT)

As a cricket fan, I am deeply saddened by this recent developments. Sahara has been sponsoring indian team almost 13 years and stood alongside indian cricket during 2007 world cup decable. At the start of ipl, excitment was high and sahara paid 17hundred crores but now everything changed, they wanted to reduce that amount and that is acceptable on moral basis. I hope BCCI will sort this and continues with Sahara. Sahara helps indian cricket and in turn it makes use of huge popularity cricket. Instead of bullying with owners BCCI should stand alongside them during crisis and needs to be bit more patience on cash dealings (this is where sahara goes for pull out). I dont know much about their dealing, i said this just as a fan.

Posted by Kapil_Choudhary on (May 21, 2013, 15:44 GMT)

While the situation is obviously sad for Pune fans, from the perspective of the entertainment value of the IPL - I say good riddance. An 8-team IPL, like in the first 3 seasons, always seemed more compact (relatively of course) and doable besides being of a higher quality. Further, Pune has struggled right through their 3 years. The timing of the decision is also perfect - with a big auction scheduled for next year. I just hope that (a) Pune doesn't change its mind again and come back like last time and (b) BCCI doesn't float a fresh tender for a 9th team, like they did when Kochi left. KEEP THE IPL TO 8 TEAMS ONLY.

Posted by TNAmarkFromIndia on (May 21, 2013, 15:36 GMT)

I see two positives from this: a) Someone else will buy the Pune franchise and will do a much better job of running it than Sahara. b) Someone will buy the franchise and choose another home city, thereby not abusing Pune's name and reputation for all that it's worth.

Pune will still get internationals and maybe even home matches for other IPL teams. I don't see any negative here for Puneites.

Posted by Batmanindallas on (May 21, 2013, 15:24 GMT)

This is how the cookies crumble...BCCI should some more shocks before it decides to behave like a normal sport body run by professionals

Posted by   on (May 21, 2013, 15:22 GMT)

No wonder Pune has been doing so badly. The grapevine lets these stories trickle to its players. No one wants to play for a ship that is rudderless or that doesn't want to set sail. Very sad day.

Posted by iamnik17 on (May 21, 2013, 15:13 GMT)

After conceding last two spot in both of the IPL it would be great if Sahara rethink their strategies, team selection in IPL rather than quitting. they should learn from KKR, after performing POOR in 3 IPL season they won it at last...

Posted by   on (May 21, 2013, 15:08 GMT)

No wonder to hear this news after Pune Warriors winning efforts in all IPL

Posted by   on (May 21, 2013, 15:08 GMT)

Damn! I am a Puneite and I used to support my team. Ipl is a huge event and having your home team in it is huge for the city and its people.only silver lining is we have mumbai to cheer for.

Posted by sumanthgutta on (May 21, 2013, 15:04 GMT)

Don't quite get why BCCI doesn't solve this. The bidding was done on the basis of 94 matches. Only 74 are getting played. Reduce the bidding amount in the same manner. What in this is so difficult for anyone from BCCI to understand?

Posted by LeftBrain on (May 21, 2013, 15:02 GMT)

Can it be said that Sahara is not taking this action due to poor perofrmance of Pune Warriors in last three years? Neverthless, a good decision, by the time people are getting mature and leaving IPL!!!!

Posted by aby_prasad on (May 21, 2013, 15:00 GMT)

I had once commented as to what eligibility pune warriors had, to be included in IPL given its performances. Ofcourse that comment doesn't make sense if you have put your investment with some long vision in your mind. A cricket crazy state like Gujarat doesn't have a single proper representation in the IPL whereas Maharashtra gets two. On the other hand, it is depressing for the owners and fans alike when a team like pune performs so disappointingly repeatedly. I wish they reduce the span(the no. of matches) of this league but include teams/more teams that make sense, including a team from Gujarat and some others. Even Kochi Tuskers performed better in the one season they got. I'd prefer more teams with lesser matches but not 16 matches spanning 2 months!

Posted by   on (May 21, 2013, 14:43 GMT)

Sad to see anyone franchise go. It seems every year, a franchise gets in trouble with their finances and has to end. RIP Pune Warriors. Hope the players make a good return in either a new club or one of the existing ones.

Posted by Cricizen on (May 21, 2013, 14:43 GMT)

If they had just lost 4 out of the 16 they played (as you suggest), they would have been just fine :)

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