$1.63 bn RR deal delayed on funding issues, regulatory scrutiny: Report

Kal Somani is raising funds for the deal and has approached several large investors, but firm commitments are yet to come through, delaying timelines for the proposed transaction.

The planned $1.63 billion sale of Indian Premier League (IPL) team Rajasthan Royals (RR) has hit a pause, as the lead investor group grapples with funding shortfalls, regulatory hurdles, and challenges in structuring the buying consortium.

 

The group, spearheaded by Kal Somani, brings together prominent global names such as Walmart heir Rob Walton, who owns the NFL’s Denver Broncos, and Sheila Ford Hamp, owner of the Detroit Lions, along with Michael Hamp. However, despite the strong investor lineup, the deal remains incomplete due to a lack of firm financial commitments from participants.  IPL 2026 Match 46, GT vs PBKS: LIVE SCORE | FULL SCORECARD | PLAYING 11 | LIVE STREAMING

 

 

Funding gaps slow progress

 

Somani is in the process of raising capital for the transaction and has approached multiple large investment firms. However, commitments have not yet materialised, pushing back timelines for the deal.

 

According to a report by Economic Times, Somani is seeking a majority stake in the consortium, though the precise capital contribution of each investor remains unclear. Somani is already an existing investor in Rajasthan Royals.

 

Due diligence, BCCI scrutiny add pressure

 

Concerns raised during due diligence have further complicated negotiations. Some consortium members are said to be uneasy about certain aspects of the transaction, particularly around historical ownership structures.

 

The Board of Control for Cricket in India (BCCI) is understood to have flagged issues related to fees on past secondary ownership transactions. These involve Mauritius-based EM Sporting Holdings, which controls Royal Multisport, the parent entity of Rajasthan Royals. 

 

Promoters explore alternative investors

 

Amid the ongoing delays, the franchise promoters have initiated discussions with other potential investors, including steel tycoon Lakshmi Mittal. The Mittal family, led by ArcelorMittal chief executive officer Aditya Mittal, had participated in an earlier bidding process but did not emerge successful.

 

According to the Economic Times report, Mittals had earlier placed a bid of around $1.5 billion. However, there is no assurance that fresh discussions will culminate in a transaction.

 

Legal dispute clouds outlook

 

The deal is also unfolding against the backdrop of a legal dispute involving former minority investor Raj Kundra. Through his firm Kuki Investments, Kundra has approached the National Company Law Tribunal (NCLT), alleging oppression and mismanagement while seeking reinstatement of his 11.7 per cent stake.

 

The matter remains under adjudication. Separately, a UK court has granted an anti-suit injunction restricting Kundra from pursuing certain proceedings, a decision currently being challenged before the Bombay High Court.

 

At a recent hearing, Justice Milind Jadhav observed that the case pertains to the anti-suit injunction and noted that an arguable case had been made, issuing notice to Emerging Media Ventures, the owner of Royals Sports Group.

 

Uncertain timeline for closure

 

Royals Sports Group, promoted by Rajasthan Royals co-owner Manoj Badale, said discussions led by Somani are ongoing and expressed confidence about a favourable outcome. However, with funding constraints, regulatory scrutiny, and legal challenges persisting, the timeline for closure of the deal remains uncertain.