Termination notice for Pune Warriors

Non-payment of franchise fee root cause of expulsion.



CHENNAI:
The Pune Warriors franchise has been served a notice of termination by the BCCI for non-payment of their franchise fee, a move that cuts down the number of teams in the IPL to eight.

At a special meeting of the BCCI working committee here on Saturday, the members decided to take this drastic step after several official reminders to the Sahara Group (owners of Pune Warriors) yielded no response.

"The BCCI Working Committee discussed the situation regarding the default by Sahara Adventure Sports (Sahara) in not submitting the bank guarantee of the Pune franchise of IPL for the 2014 season," BCCI said in a statement.

"As per the terms of its franchise agreement, this bank guarantee was due for delivery in March 2013, more than six months ago. Given Sahara's continued position that it would not deliver the bank guarantee, the Working Committee unanimously determined to terminate the Sahara franchise agreement, while taking whatever action was necessary to protect the BCCI position."

The fate of Pune Warriors was always in doubt after the Board had earlier encashed its bank guarantee due to non-payment of the franchise fee. This led to the Sahara Group pulling out of IPL, with their reinstatement hinging on payment of a bank guarantee of over Rs. 170 crore.

"Over the last six months, the BCCI's advisors have written to Sahara on five separate occasions (in April, May, June, August and October) requesting that the bank guarantee be put in place, with the final letter being sent on 8 October 2013. In response, Sahara again refused to put in place the guarantee as per the franchise agreement," the statement added.

"In order to proceed with the preparations for the 2014 season, it is important that BCCI now has certainty as to whether the Pune franchise will comply with the terms of its franchise agreement."

Sahara’s contention was that the franchise fee in their case should have been lowered since the BCCI did not deliver the promised number of IPL matches for Pune. But arbitration on the same has been in a stall due to irreconcilable differences between the BCCI and Sahara.

Sahara had bought the Pune Warriors franchise for USD 370 million (approx. Rs 1700 crore) in 2010, making it the most expensive IPL franchise. Saturday’s meeting was also the first after N Srinivasan's return as president.

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