A consortium led by Lakshmi Mittal, Aditya Mittal and Adar Poonawalla has reached a final agreement to acquire the Rajasthan Royals (RR) franchise along with associate teams. However, the United States-based group led by Somani is preparing a possible legal challenge after their advanced talks failed yesterday.
The final agreement has set the new enterprise value of Rajasthan Royals at approximately $1.65 billion (Rs 15,660 crore). The Mittal family will hold a 75 percent majority stake, Adar Poonawala will hold 18 percent, while existing shareholders including founder Manoj Badale will hold the remaining seven percent.
key points
- Rajasthan Royals’ $1.65 billion deal finalized with Mittal family and Adar Poonawala
- Kal Somani led union is preparing for legal action
- Controversy over delays and malicious interactions
Rajasthan Royals ownership deal in turmoil
According to a report in Cricbuzz, this triggered internal discussions on legal action and public relations strategies across the United States. The group plans to respond quickly by issuing a formal legal notice to the relevant parties today, the report said.
“We have received calls this morning regarding legal and PR in the US. We are taking a decision on our PR. A legal letter will be sent today,” the report quoted a source as saying.
“If we are going to make this matter public then we will discuss it with our group because it will also involve litigation.”
In previous reports dated March 24, Kal Somani had won the bid with major investors including Walmart heir Rob Walton, owner of the NFL’s Denver Broncos, and Sheila Ford Hamp, owner of the NFL’s Detroit Lions. There is also a strong possibility that BCCI may be directly involved in this dispute.
Also read: After Kal Somani deal fell apart, Rajasthan Royals sold Mittal family’s Adar Poonawala for $1.65 billion
Consortium accuses Rajasthan Royals of delay and miscommunication in failed deal
The consortium accused the Rajasthan Royals management of dragging out the documentation process by holding side talks with ill intentions. The report said the group had hundreds of questions about the amount owed and ongoing legal cases and had been ready to close the deal for more than a week.
“They took it slow. They continued negotiations in good faith until the last second,” the source said.
“We had questions such as whether BCCI dues were paid. We wanted to know the status of legal matters. There were hundreds of such questions. From our side we are ready to shut down for 10 days. There was deliberate delay and then side dealing.”
The Somani deal reportedly fell through yesterday as the businessman failed to meet the one-month exclusivity period required to make official payments. Manoj Badale put the franchise up for sale as he wanted to make an exit before the next round of Indian Premier League media rights, which is expected to be challenging.
Somani Group denies funding issue, protests Manoj Badale’s role in Rajasthan Royals deal
The Somani-led group rejected claims that funding issues blocked the deal. The report said that the strong backing of the Walton and Hamp families ensured sufficient capital for the billion-dollar transaction.
“With the Walton and Hamp families behind them, money was never an issue,” the report’s source said.
Another major issue in the talks was the future role of current chief owner Manoj Badale. The Somani Group opposed retaining him, while the final deal with Mittal investors placed Badale in a key role to support the franchise with his experience.
Franchise valuations continue to rise as these assets remain scarce. Aditya Birla Group bought Royal Challengers Bangalore in March for $1.78 billion, while Torrent Pharma last year valued Gujarat Titans at around $800 million after a combined expansion value of $1.6 billion in 2021.
FAQ
- Why is there a problem in the deal of Rajasthan Royals?
after their bid failed yesterday due to a possible legal challenge from the Somani-led consortium. - Who is buying Rajasthan Royals?
A consortium led by Lakshmi Mittal, Aditya Mittal and Adar Poonawala. - What is the deal value?
Approximately $1.65 billion.
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