The Daily Telegraph - Saturday - Sport Saturday
Hundred sell-off to pass first hurdle with counties
Counties will give the England and Wales Cricket Board the green light to continue on the “direction of travel” with private investment in the Hundred, but non-hosts are digging in over questions that remain unanswered.
A fortnight ago, the ECB requested that the 18 first- class counties and the MCC provide a “non-binding” position on the capital share model they have devised for private investment into the eight teams in the competition, which they hope will happen this year.
While this was not a formal vote, 15 of the 19 were required to provide a positive response. That hurdle was cleared yesterday, with the counties supporting the direction of travel.
In the model, the ECB would hand 51 per cent of the eight teams to the host county (or club, in the case of the MCC at Lord’s). The remaining 49 per cent would be sold to private investors. The host county could sell as much of their 51 per cent as they pleased.
The proceeds of the 49 per cent sold would be split as follows: the first 10 per cent to the recreational game, with the rest shared by the counties. The first £ 275 million raised would be shared 19 ways, with the next £150 million shared between the 11 non-hosts. All proceeds above £425 million would be shared 19 ways once more.
The proceeds of the 51 per cent would be split as follows: the first 10 per cent to the recreational game, the next 80 per cent to the host county, with the final 10 per cent split by the other 18.
The model for sale has been built in partnership with Deloitte, but the split has caused division among the hosts and non-hosts. Hosts say they are taking on all the risk because they have to manage and fund the teams together with their new partners. The non-hosts are desperate for further clarity over their position on a number of fronts.
On Monday, the 11 non- hosts wrote to the ECB outlining their concerns, saying that while “we do not wish to slow the process down”, they “unfortunately cannot agree to the direction of travel at this stage”.
That position has appeared to change this week. Sources suggest they are set to give the ECB the green light to proceed, but, as a united front, will request further detail on a number of matters and seek independent advice.
There is consensus that private investment is wanted in the tournament, but details need to be ironed out both over the capital share, as well as other big issues, such as future expansion. “Yes, but with big caveats” was how two sources described the non-hosts’ position to Telegraph Sport.
In their email on Monday, the non- hosts requested £ 200,000 from the ECB to engage a law firm to receive specific advice and guidance, but the ECB turned them down on the grounds that Ernst and Young was already engaged to compile a report on the work Deloitte has done with the governing body. The 11 non-hosts are understood to be proceeding with commissioning that advice at their own cost.
In a response, seen by Telegraph
Sport, ECB chief executive Richard Gould said: “Neither current hosts nor current non-hosts are particularly enamoured with the capital structure of the deal. Both parties want more, hence the compromise and fair model put forward by ECB. I do not sense that either party is prepared to give up more value, and both would like more.”
Some counties – 15 of whom are member-owned – have been gently engaging with their members on the matter, but are not looking at giving them a formal say.
The sale will be managed by Raine, the New York-based bank, and it is understood that there is interest in investing in teams from firms in India (including most Indian Premier League franchises), Pakistan, the United States and Britain.
The MCC, which is different from the rest in that it does not have a professional team, has committed to begin formally engaging with its members, but was happy to proceed with the direction of travel.