United Spirits makes killing 3,400% return from RCB sale:Diageo’s investment in Bengaluru-based IPL team grows 35x in 18 years

In a major shake-up in the world of cricket and business, Royal Challengers Bangalore (RCB), one of the most popular teams in the Indian Premier League (IPL), has changed owners. The ₹16,660 crore sale marks a significant financial win for United Spirits, the team’s previous owner, and a new chapter for RCB under fresh leadership. United Spirits’ investment multiplies 35x in RCB United Spirits, now part of the global beverage giant Diageo, initially invested in RCB back in 2008. Over the past 18 years, Diageo’s investment has grown 35x. How much United Spirits invested in RCB back in 2008? Back in 2008, United Spirits, then under the leadership of Vijay Mallya, bought the RCB franchise for approximately $111.6 million (around ₹476 crore at the time). This was a significant investment, reflecting the growing popularity and potential of the IPL. United Spirits’ ₹476 crore investment in RCB grows to ₹16,660 crore Now, years later, United Spirits is reaping the rewards of that early investment. By selling RCB, the company is generating a staggering 3,400% return. This means that for every rupee invested, they are getting back over ₹35! It’s a testament to the growth of the IPL and the value of the RCB brand. What old owners say? According to the disclosures filed by United Spirits’ parent company Diageo with the National Stock Exchnage (NSE) its estimated that United Spirits will receive ₹16,660 crore once the sale is finalised. This windfall gains will likely be reinvested into Diageo’s core business, further strengthening its position in the global beverage market. Who’s taking over RCB? The new owners of RCB are a consortium of investors led by Aditya Birla Group, The Times of India Group, Bolt Ventures and Blackstone. The new deal promises fresh investment and a renewed focus on performance, both on and off the field. This transaction marks an important milestone for USL as we sharpen focus on our core beverage alcohol business to unlock its true potential with sustained growth, and to continue delivering on long-term value creation for our stakeholders. RCB has grown into the most prominent and commercially successful franchise in the IPL and WPL. Guided by its ‘Play Bold’ philosophy and a strong competitive spirit, it has built a globally recognized brand and a passionate fan base. We are excited for the future of RCB under the stewardship of the new owner. As Sports enters a new phase of growth in India globally, we believe this is in the best interest of the franchise and our stakeholders. On behalf of USL, I thank everyone who has contributed to RCB’s journey for their continued support – the BCCI, the fans, players and employees. -Praveen Someshwar, MD CEO, US A new innings for RCB! With new owners at the helm, RCB is poised for a new era. Fans can expect continued excitement, with potential changes in team strategy, player acquisitions, and overall management. The goal, of course, remains the same: to retain the coveted IPL trophy. We are proud to become custodians of RCB and grateful to USL and Diageo for the franchise they have built. RCB’s championship-winning culture, its deep connection to Bengaluru, and one of the most passionate fanbases in world sport make this an extraordinary opportunity. We are committed to taking RCB to new heights, on the pitch and beyond. -The Acquiring consortium How much Vijay Mallya invested in RCB? It’s worth noting the role of Vijay Mallya, the former chairman of United Spirits, in the RCB story. Mallya was instrumental in bringing the team to life and building its initial brand. However, due to financial difficulties, he eventually stepped down from his position. In 2008, the liquour baron acquired the Bangaluru based IPL team’s franchise for approx ₹476 crore. Key details regarding Mallya’s investment in RCB: Context: This was the second-highest bid during the inaugural IPL auction, narrowly behind the Mumbai Indians franchise.
Funding Origin: The team was acquired by the UB Group, of which Mallya was chairman. It was named after their liquor brand, Royal Challenge.
Ownership Shift: Following financial and legal issues, control of the team transitioned to United Spirits Limited (a Diageo group company) in 2016. A win-win situation for both parties! The sale of RCB is a win-win situation for all parties involved. United Spirits/Diageo gets a massive return on its investment, the new owners get a valuable IPL franchise with a loyal fan base, and RCB gets a fresh start with new resources and leadership. As the IPL continues to grow in popularity and value, expect more such high-profile deals in the future.