Published 17:47 IST, August 21st 2020
Dream11 to raise additional $235 million for reducing China-owned Tencent's stake in firm?
Dream11 was recently named as IPL 2020 title sponsors with bid of ₹222 crore, outbidding BJYU's, who had bid for ₹201crore and UnAcademy for ₹171 crore.
- SportFit
- 3 min read
Following VIVO's exit from the Indian Premier League (IPL 2020) as title sponsors, the BCCI were struggling to find suitors who would be ready to pump in the money. However, the wait finally ended this week when BCCI announced Dream11 as IPL sponsors for the 2020 season. The Indian fantasy gaming giant is already a big name in the world of cricket as they are not only associated with at least six teams for the IPL 2020 but also with the International Cricket Council.
Dream11 aiming to reduce Chinese stake in the firm?
Recently, a report was published by The Indian Express, which said that the IPL 2020 sponsors Dream11 is in advanced talks with at least four private equity firms to close a $235-million deal. A source familiar with the development, spoke to the publication, by claiming that the deal consists of a $35-million primary fundraising and a $200-million secondary sale of shares, which could see the Dream11 Chinese investor Tencent Holdings Ltd’s stake percentage come down to just single digits.
The source also revealed that currently, unlike the large perception that Tencent has a 'majority stake' in Dream11 that makes it a 'Chinese company', it doesn't in reality anymore. Tencent holds about 10.9% shares in the holding company of Dream11 Fantasy Pvt Ltd, now known as Sporta Technologies Pvt Ltd, which is a big difference from its ₹700-800 crore investment back in 2018.
Sharing more insight on the deal, the source said that the deal is likely to see Dream11’s valuation increase to $2.5 billion from $1.1 billion as of April 2019. The source further revealed that the private equity firms that are evaluating buying a stake in Dream11 include TPG Capital, Tiger Global Management and Footpath Ventures among others and the deal is likely to be announced soon.
About the IPL Dream11 deal
Talking about IPL sponsors, the IPL Dream11 deal was only made official by BCCI after the gaming platform outbid team India sponsors BJYU's and Unacademy. The IPL Dream11 deal is reported to be ₹222 crore, outbidding BYJU's, who had bid for ₹201 crore and UnAcademy for ₹171 crore. According to Indian Express, the duration of the sponsorship with Dream11 is until December 31 this year.
Before Dream11 was brought onboard as IPL sponsors, the Sourav Ganguly-led BCCI had been in the lookout for a new IPL sponsor. The IPL sponsors title was left vacant after VIVO, which had signed a ₹2200 crore, 5-year deal (2018-2022) with BCCI, withdrew after the Boycott China campaign gathered steam in the wake of the India-China standoff.
(COVER IMAGE: DREAM11 / TWITTER)
Updated 17:47 IST, August 21st 2020