“By the barest of margins!,” exclaimed seasoned cricket commentator Ian Smith as England lifted the ICC One Day International Cricket World Cup for the first time since its inception in 1975. The date was 14 July 2019, and the venue was the ‘Home of Cricket’, Lord’s, England. For many, this was poetic justice, with arguably the best Limited Overs Cricket Team in the world in recent years finally lifting the coveted trophy, playing a brand of the sport that was unprecedented and exhilarating.
This brand of cricket also attracted viewers. An estimated eight million people watched the final across both Channel 4 and Sky Sports in the United Kingdom.1 Whilst these viewing figures pale in comparison with other sporting events such as the Olympics or the World Cup, the fact that the event also clashed with British super events, the Silverstone Grand Prix, and the Wimbledon Men’s Final, does suggest the latent potential that the sport has to attract significant audiences.
Advent of Franchise Cricket
Whilst many consider that afternoon at Lord’s as a watershed moment in English cricket, it was an evening 5,000 miles away, and 11 years earlier in Bengaluru, India that diverted the path of world cricket for the years ahead. The first ever match in the Indian Premier League (the “IPL,” a 20 over franchise competition) saw current England team manager Brendan McCullum bludgeon 158 runs off just 73 balls as the Kolkata Knight Riders demolished the Royal Challengers Bangalore.2
The subsequent evolution of the IPL into the most successful franchise cricket league in the world since April 2008 has been nothing short of spectacular. The U.S. Investment Bank, Houlihan Lokey, valued the IPL at U.S. $16.4 billion in 2024, a 93% increase from its valuation of U.S. $8.5 billion just two years earlier.3 The explosion of popularity has ensured that the IPL stands on the pantheon of most valuable sports leagues globally, alongside the NFL and MLB in the United States.
The growth in popularity of cricket in India, catalysed by the IPL, has certainly turned heads of those that sit within the England and Wales Cricket Board (ECB). With star players such as Kevin Pietersen, Ben Stokes, and Sam Curran obtaining contracts valued at over U.S. $1 million per season to play in the IPL, the prospect of the best players in the country foregoing their central contracts with the ECB to pursue franchise-based tournaments instead has emerged. The ECB, cognisant of this imminent threat, have therefore taken measures to financially incentivise their players to forego IPL contracts.
The irony is that it was in fact the ECB that first conceived of a short-form 20 over competition - the T20 Blast, which launched in 2004 some four years prior to the IPL. In retrospect, the ECB failed to appreciate the potential of the new format for TV audiences, whilst their Indian counterparts, the Board of Control for Cricket in India (BCCI), did with spectacular results with the IPL. The latest media rights deal4 for the tournament, inked in 2022 for coverage in India alone, generates more than USD 1 billion per year for the BCCI.
Hundred Up
In a belated effort to take on the IPL in August 2021, the ECB launched a 100-ball cricket tournament, christened “The Hundred,” in venues across England and Wales. Once again, the format is groundbreaking, dispensing with traditional six ball overs in favour of five or ten ball bursts from bowlers, with a total of 100 deliveries for each bowling side. Accompanied by fireworks and music throughout, the tournament is aimed very much at families and not the stereotypical cricket-supporting demographic of middle-aged men.
The tournament runs over a four-week period during the end of the British summer, with separate tournaments for men and women. Drawing away from the traditional English county-based format, the teams are instead associated with a city, with the eight largest cricket venues across England and Wales playing host to a competing team. Certain counties benefit financially from the tournament, because (with the exception of Middlesex CC) they own the grounds acting as host venues for matches.
The first three seasons of The Hundred were deemed a success. With many talented players from around the world such as Jos Butler, Andre Russell, and Shaheen Afridi participating, as well as a record 580,000 tickets being sold in 2023 (an increase from the 2021 and 2022 seasons), The Hundred aims to be a vector of growth for cricket in the country.5 This growth is not limited to traditional cricket fans. In line with its ambitions, more women and juniors have attended matches than in any prior ECB tournaments. Diversifying the audience is of paramount importance to the ECB, and The Hundred has delivered on multiple fronts.
However, as new franchise leagues have launched in the United States and South Africa, providing players with choices on where to obtain lucrative contracts, the onus is increasingly on the ECB to ensure that the best cricketers congregate in the UK every summer, or see The Hundred project fail.
Structural Reform
It is with this increased competition in mind, that the ECB is aggressively looking to the future. Currently owning a 100% stake in each of the eight teams (Men’s and Women’s) in The Hundred, the ECB maintains full control and ownership of the tournament itself. To inject the capital needed to propel the tournament forward – and to continue to attract the best players in light of increased competition - they have proposed private investment into the league on a team-by-team basis.
Under this proposal, which is set to be finalised before the 2025 season, the ECB will sell its entire stake in each of the teams. The host counties (e.g. Lancashire for Manchester Originals) will retain a 51% stake, and the remaining 49% will be available for private investment. The Counties will also be at liberty to sell some or all of their stake in each franchise, should they wish to.6
The ECB is hoping to generate £500 million from the sale, which they will invest into the recreational game, as well as into the established County system.7 The plan for distributing funds raised from the investment has caused some controversy due to differences between the operational model of The Hundred and the traditional County based structure of cricket in England & Wales. Whilst seven of The Hundred teams are affiliated with their corresponding counties, the remaining 11 counties do not currently benefit financially from the competition.
With counties such as Gloucestershire experiencing financial difficulties, and not hosting a team in The Hundred to ameliorate this, envious glances are being cast as hosting counties from those that do not have a team. To alleviate this situation, the ECB has indicated that 10% of the funds raised from the sale will be allocated to the recreational game in England and Wales. Of the remaining 90%, the first £275 million raised will be shared between all 18 first class counties (and the Marylebone Cricket Club (MCC)), and the next £150 million will be allocated solely to the 11 non-host counties.8
Any proceeds over and above the hoped-for £425 million distribution, will be shared between all 18 first class counties. The ECB has conceived this model to not only inject capital into The Hundred but also channel much-needed revenue to the counties that are not direct beneficiaries of the tournament. 9
Who Might Invest?
The identities of potential franchise owners for The Hundred remain unclear. In recent weeks media reports indicate that owners of UK football teams have expressed an interest in investing, and the ECB has confirmed that it has sent promotional material to owners of U.S. NFL teams to stimulate interest.10 Other mooted buyers range from Middle Eastern Public Investment funds to U.S.-based private equity companies.11
Mark Nicholas, President of the Marylebone Cricket Club - owners of Lord’s - has stated that IPL team owners have shown “soft” interest in investing in London Spirit.12 If this happens, it would not be unprecedented - IPL owners have invested in leagues worldwide. Recently, for example, Mumbai Indians acquired teams in Cape Town, New York, and Abu Dhabi.
However, the ECB might face some challenges if IPL owners invest in The Hundred. For example:
- The BCCI currently restricts active Indian players from competing in the IPL, meaning (unless something changes) cricketing superstars like Virat Kohli and Rohit Sharma would not play in The Hundred. This may reduce its appeal to global (and Indian) audiences, in turn reducing the attractiveness of the investment.
- It is likely that IPL owners will want a level of control given the size of their potential stake and the experience they bring from running and growing cricket franchises. A 49% stake may not be palatable.13
- Complex geopolitics has historically led IPL owners to exclude Pakistani players from competing in their teams. This is a thorny issue for the ECB to navigate.
The Next IPL?
The Hundred will inevitably be compared to the IPL, considered the gold standard in franchise cricket.
However, challenges exist in comparing the two. The Hundred only runs for four weeks across the English summer, while the IPL lasts two and a half months, and India's population of 1.4 billion boosts IPL viewership – both factors impacting the value of potential media rights deals which in turn drive the value of the franchises. For context, the IPL final alone drew 505 million viewers, a number dwarfing the UK's total population many times over.14
Stadium capacities also differ. By way of example, the Narendra Modi Stadium in Ahmedabad seats 132,000, while Lord's (the largest of the cricket grounds used for the Hundred) holds 31,100. Thus, revenue from The Hundred's ticket sales will likely always fall short of the IPL's, again impacting the comparative valuation of teams. It is therefore likely to be some time before valuations of over USD 200 million (a number attributed to four of ten IPL Franchises) are achieved in The Hundred.15
Given the apparent level of interest in acquiring stakes in The Hundred’s existing teams, it is clear that investors do not see these challenges as insurmountable. Experienced investors, particularly those with existing exposure to sports, will be confident that they can find innovative ways to drive growth and push up the value of their chosen team. How they will do that remains to be seen, but it is unlikely to be by maintaining the status quo.
The County Conundrum
The ECB faces internal challenges with The Hundred. Despite record-breaking attendances - with 41% of tickets being sold to families in line with the ECB’s ambitions - and increased TV viewership, sharing the financial upside of the tournament with the 11 non-host counties remains critical to achieving the aim of ensuring sustainability for all counties and the wider game.16
If The Hundred boosts interest in cricket in England and Wales, it could benefit other domestic leagues, like the NatWest Blast and County Championships, though there will also be pitfalls. Non-hosting counties such as Durham have historically been the bedrock of producing, and nurturing England players, such as Ben Stokes and Mark Wood. If they remain a non-hosting county, there will remain a possibility that their players may transfer to hosting counties to increase their chances to participate in The Hundred. The current England Opener, Phil Salt recently moved from Sussex (a non-host) to Lancashire, and now plays for the Manchester Originals. The ECB must incentivise non-hosting countries to further produce excellent cricketers without being able to dangle the carrot of hosting a team in The Hundred.
Scheduling is also an issue; expanding The Hundred's window could push other ECB competitions into less favourable, rain-prone periods - this has already been an issue for the Country championship, a breeding ground for England’s Test team, but to some extent marginalised since the advent of the Hundred. The County set-up is favoured by many traditional cricket fans and the ECB faces a tough balancing act in keeping cricket’s longest-serving fans happy, whilst encouraging a new audience more focused on the short-form game.
Finally, an issue with the performance of the national team is also at play. Long form “Test Match cricket,” played over up to five days, remains the pinnacle for the England Cricket Team. If the domestic four-day matches are being played in the colder, rainier months, the skills of prospective Test Match players will be impaired. How do you produce Test Match ready spinners when these bowlers do not get the opportunity to hone their skills in conducive conditions?
What’s Next?
Former England Test Captain Joe Root, one of the stars of the English game, is clear that investment in the Hundred can drive the game forward: “With the structure we have now there is a clear ceiling to where the game can go and the investment that can go into county cricket. With private investment we will have exposure to better players and facilities; with extra money you’d like to think it would impact things drastically and keep our game more sustainable”.17
It is difficult to disagree with Root. Increased investment in The Hundred will almost certainly increase the quality of the tournament, as well as interest in the game, amongst the public. However, with 11 counties facing a cricketing blackout during the most lucrative period for the English game, and the possibility of other, more traditional formats being compromised as a result of the investment, the ECB must act carefully, yet decisively.
As the 2024 iteration of The Hundred draws to a close, in the second part of this article we consider the practicalities of investment into The Hundred, including valuing the franchise and the due diligence investors (and the ECB itself) will perform. As investors ponder how to drive growth, we consider the various options available to them.
1. 4.5 million Britons watch Cricket World Cup final on Channel 4 | TV ratings | The Guardian
2. RCB vs KKR Cricket Scorecard, 1st match at Bengaluru, April 18, 2008 (espncricinfo.com)
3. IPL valuation rises to $16.4 billion in 2024, Chennai Super Kings remain most valued franchise: Report | Cricket News - Times of India (indiatimes.com)
4. https://www.theguardian.com/sport/2022/jun/14/indian-premier-league-signs-five-year-television-deals-worth-5bn
5. The Hundred shatters attendance records and increases TV viewing figures across men's and women's competition | Cricket News | Sky Sports
6. Financial advisors and legal counsel appointed by ECB in Hundred private investment process | ESPNcricinfo
7. Is the Hundred at risk of wasting its shop window? (thetimes.com)
8. Financial advisors and legal counsel appointed by ECB in Hundred private investment process | ESPNcricinfo
9. Financial advisors and legal counsel appointed by ECB in Hundred private investment process | ESPNcricinfo
10. The Hundred: NFL owners contacted by ECB over team sales - BBC Sport
11. Saudi Arabia’s PIF ‘interested’ in buying The Hundred's Durham franchise - SportsPro (sportspromedia.com)
12. MCC president Mark Nicholas says five IPL franchises show 'soft' interest in Lord's Hundred stake | ESPNcricinfo
13. IPL franchises eye controlling stakes in Hundred teams | ESPNcricinfo
14. IPL 2023 records massive viewership of half a billion viewers on television - BusinessToday
15. Houlihan Lokey – IPL Valuation Study 2024
16. The Hundred: Hit For Six? - Memery Crystal
17. https://www.thetimes.com/article/d6cd3037-4962-4af0-9d5f-cfa828f7a6cd?shareToken=7cba32e483c8a839f4bb3581c70d351d
© Copyright 2024. The views expressed herein are those of the author(s) and not necessarily the views of Ankura Consulting Group, LLC., its management, its subsidiaries, its affiliates, or its other professionals. Ankura is not a law firm and cannot provide legal advice.
