Kal Somani, an existing shareholder in the Rajasthan Royals IPL team, has taken over the franchise, acquiring the Jaipur-based outfit for USD 1.63 billion, which is approximately INR 16,290 crore. Times Group, which was also in the fray, finished a close second in the bidding race.
Somani will head a consortium that includes Walmart, and his group has acquired a full 100 percent stake in the Royals - one of the original eight IPL franchises. He is expected to take over the reins after the 2026 season from UK-based Manoj Badale of Emerging Media.
Hailing from Scottsdale, Arizona, Kal Somani, who is in his 50s, has interests in golf apart from cricket. He is one of the founders of Motor City Golf Club, which has an association with golfing legend Tiger Woods. His son, Arjun Somani, is a promising talent on the US junior circuit. Somani's interests range from academics to sport and he is the founder of multiple companies.
Industry experts have said the USD 1.6 billion valuation for Rajasthan Royals is not surprising. "RR deal validates higher franchise valuations," said Karan Turani of Elara Capital.
"The acquisition of Rajasthan Royals by a Kal Somani-led consortium at $1.63bn reinforces our view that IPL franchises are now valued in the $1.5-2.0bn range, supported by strong media monetisation and rising global investor interest."
The bidding is believed to have concluded on Monday and the winner was finalised then itself. There were multiple bidders and Times Group was one of them. The Board of Control for Cricket in India (BCCI) is still to be made aware of the transaction and as per the IPL franchise agreement, the BCCI has to be paid five per cent of the transacted money which is close to INR 765 crore.
Rajasthan Royals were the lowest-priced franchise among the original eight in an auction spearheaded by Lalit Modi in 2008. It was then valued at USD 67 million and bought by a consortium led by Badale. The franchise surprised everyone by winning the inaugural season under the captaincy of Shane Warne.
Modi's brother-in-law, Suresh Chelaram, later held a majority stake of 56 per cent but exited the franchise eventually, after which Badale emerged as the lead owner. In between in 2009, the Royals sold a 13 per cent stake to Raj Kundra, valuing the franchise at roughly USD 120 million. Kundra then was believed to have shelled out INR 65 crore for 13 percent stake.
Kundra had to leave the ownership group in July 2015 after being handed a life ban by the Lodha Committee for his involvement in betting activities. In 2021, the Royals sold around a 15 percent stake to RedBird Capital Partners for approximately INR 550-600 crore. As part of that transaction, a drag-along clause was introduced, meaning that if RedBird decides to exit, other shareholders may also be required to sell.
The drag-along clause ensures a higher overall valuation, as a controlling stake typically commands a premium, whereas the sale of a minority stake attracts relatively lower valuations. With RedBird insisting on the clause and wanting to exit, the current owners have had little choice but to put the franchise on sale.
