Cricket Australia – Priavte Equity Investments BBL? The last 18 months has been quite troublesome for Cricket Australia (CA). The news of cash crunch for the board in 2020 made headlines & the same led to 50% of staff getting boot as cost-cutting measure. To overcome all financial issues, CA is now exploring options of private equity investments in Australian cricket for the 1st time – Follow LIVE Updates from the world of cricket on InsideSport.in
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Cricket Australia considering private investments in Big Bash League, starts conversation with private equity firm Silver Lake
Cricket Australia – Priavte Equity Investments BBL? According to reports in leading Australia daily The Sydney Morning Herald (SMH) the national governing body’s interim chair Richard Freudenstein and chief executive Nick Hockley are working on a strategic plan for the next five years, and that private equity investment is considered a viable option.
The report claims that CA held talks with Silver Lake earlier this year to discuss the private equity firm’s interest in Australian cricket.
According to the report, CA is exploring following options –
- First to sell minority stakes in Big Bash League (BBL) franchises.
- Second is to restructure the Twenty20 competition’s commercial operations into its own entity and sell a stake in that,
- Third is to create a commercial arm for the whole of CA with the goal of securing a much bigger private equity investment exactly like World Volleyball or ITTF has done.
Why Cricket Australia is exploring options to raise private equity investment?
It was reported in 2020 that Cricket Australia is facing cash crunch due to value erosion in their equity investments. The governing body is facing a negative cash flow of US$66.63 million over the next three years without significant financial restructuring.
CA now is has appointed Boston Consulting Group (BCG) to explore private investment options. On 4th November BCG lay out the governing body’s financial position, including options for private investment to the Australian cricket stakeholders.
The meeting was attended by senior executives from CA, the state associations and the Australian Cricketers Association (ACA).
The report further says if CA were to opt for privatisation it would reportedly have a radical impact on its structure, including cricket’s tax-free status.
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