NEW DELHI: Due to the rising anti-China sentiment in India, the Chinese mobile manufacturer’s arm Vivo India has decided not to sponsor the IPL this year. The BCCI and Vivo had entered in a contract for the IPL sponsorship in 2017, for 5 years worth a value of Rs.2,199 crore. They were to pay the BCCI approximately Rs.440 crore per year for the sponsorship rights.
Vivo and the BCCI have, for this year, decided to part ways but might join hands together from next year onwards based on the situation prevailing then.
Though the BCCI officials are relieved over this year’s sponsorship not going to Vivo, they are also worried about getting a replacement at such short notice. With only a month and a half to go for the IPL and with the markets in distress due to the Covid-19 pandemic, getting a replacement may prove to be a tough job.
“It was a tightly drafted contract to protect all parties concerned and the BCCI has done excellently to ensure that there are no legal repercussions to this right now,” a source familiar with the matter said.
Currently the BCCI is in the process of negotiating with its stakeholders and potential sponsors to find a solution to the crisis it is in currently.
Vivo got the sponsorship rights to the IPL just after soft-drink giant PepsiCo walked out from Rs.396 crore deal in October 2015, ensuring the IPL earned an approximate 450% on the rights value. Experts said that the contract by the BCCI and Vivo was ‘highly overvalued’ by almost 40% of a realistic value.
With the exit of Vivo and spectators from the stadiums, each franchise may lose approximately Rs.50 crore. However, the BCCI says the franchises are being ‘pennywise pound foolish’ from their perspective.
Sources from the corporate world state that Vivo’s replacement could be an e-commerce company or an education startup. A formal announcement for Vivo’s replacement can be expected in 2 days.