Why English cricket is like the Premier League 20 years ago
The sale of Hampshire to Indian investors is just the start of a flood of overseas money into English cricket, says Laurie Pinto – and, as the man brokering these deals, he should know.
English cricket is primed to undergo the sort of transformation seen in domestic football 20 years ago, when wealthy foreign investors began to take over from local businessmen and ushered in a new era of commercial success.
That is the view of the man who brokered the first such deal, last month’s acquisition of Hampshire Cricket by Indian conglomerate GMR, which also owns the IPL team Delhi Capitals and several other T20 cricket franchises around the world.
The trickle is set to become a flood, with English cricket chiefs currently engaged in an auction of stakes in teams in its own white-ball competition, The Hundred, that is likely to see more investment from India and the US in particular.
Laurie Pinto, the founder of Pinto Capital and a seasoned broker of football takeovers, advised Hampshire on their sale and sees parallels between the stage cricket finds itself in and the Premier League’s situation two decades ago.
“The Hampshire deal set an important precedent by showing that cricket is open to international investors. We are already speaking to a number of parties about future opportunities,” Pinto tells Morning Wire.
“International investors are looking at The Hundred, but also the counties more generally, especially considering how valuations compare to football clubs. If you are a multi club or multi-sport owner adding a cricket team to your portfolio makes sense.
“In cricket, there is much more stability compared to football, where there is increased competition for assets driving up prices, more barriers to entry such as regulation, and higher levels of public scrutiny.
“We are bullish on the prospects of cricket becoming a serious commercial entity and asset class as we see in football. The counties, fans and players are ready for this.”
Other counties and Hundred franchises are expected to be snapped up by Indian investors, with Morning Wire revealing that the owners of Kolkata Knight Riders and Chennai Super Kings were engaged in a battle for Manchester Originals.
But US groups have also been courted, with Wrexham AFC owner Ryan Reynolds linked with a bid for Cardiff-based Welsh Fire, and Pinto insists that interest has come from the southern hemisphere and Middle East too.
“As well as multi club owners or multi-sport owners, investor types range from high-net-worth individuals to large family offices as well as traditional private equity groups, all looking to gain a piece of the English cricket system,” he adds.
“The investors looking at English cricket opportunities are truly global. They are not concentrated from one continent, but some are expansive international groups looking to gain a rare asset at a relatively good entry price – compared to, for instance, the extremely high valuations of NFL teams in the US or Premier League teams in the UK.”
While the Hundred auction has been a catalyst for English cricket to go to market, buyers are also interested in the historic counties which house the franchises, says Pinto.
GMR’s takeover of Hampshire is for the whole club and its ground, the Utilita Bowl, with a deal for Southern Brave contingent on approval from the England and Wales Cricket Board (ECB).
“From our conversations, investors are interested in all types of cricket assets and any arrangement,” he says.
“This is such an interesting and shifting time in the business of cricket. Investors are suddenly realising that assets they never thought they would have access to could potentially be available. If you could buy what you really want, why would you now settle?
“The Hampshire deal showed that traditional mindsets can be changed, and that innovation and entrepreneurship is welcome in English cricket.”
Not everyone is so bullish, with Lalit Modi, the man who made the IPL a commercial juggernaut, conspicuously rubbishing the ECB’s valuations of Hundred franchises. Pinto says Modi’s opinions “have to be listened to” and “have some credence in questioning this”.
He adds: “No one can be sure of the future, so we have to bear in mind that the auctions going on right now are auctions. And auctions are always tricky for buyers. Sellers want to price maximise, while buyers want to buy as cheap as possible.
“These are rare assets that will be locked in for a minimum of three years and its serious money. Only time will tell if he is right.”