The bidding for two new teams in the next edition of the Indian Premier League was put off on Sunday after the organisers said they are cancelling the current tenders and will come out with a fresh bidding on March 21.
"A new tender will be put out on March 21 in Chennai, the submission date for the new tender is 10 am March 21 and opening of the tender will be at 11am on March 21. All new conditions on the new tender will be out on March 9," IPL commission Lalit Modi said in Mumbai on Sunday.
Only three parties came forward for the bidding of two franchises because of a few tough norms, forcing the IPL governing council to return the bids without opening it.
Bollywood stars Saif Ali Khan and Kareena Kapoor along with Videocon Enterprises had formed a consortium and were present for the bidding, along with Gautam Adani-owned Adani Enterprises. J P Group had sent a late bid on Saturday which was not accepted by the governing body.
"All the existing tenders have been given back the tenders without being opened. All the bidders have the right to take back the Rs 5 lakh deposit, or they can resubmit it on March 9 and collect the new tender document. Critical is that we will accept the tenders only on March 21 at 10 am," said Modi.
The IPL had set a base price of US $225 million per franchise, and, as per the tender conditions, the bidders had to submit $100 million bank guarantee to participate in the bidding process, while the company's net worth had to be $1 billion.
The IPL has now amended two clauses in its new tenders for the new franchises, dropping the $100 million bank guarantee and company's net worth of $1 billion.
"Some primary changes in the tender are -- we had a clause in the new tender of $1 billion net worth value [of the company] and that has now been removed. The second was that you had to give an advance bank guarantee of $100 million dollars; that clause has now been removed.
"Then there was the clause that the governing council, at its discretion, can or may require the winning bidder to submit 100 percent of the bid amount. That clause has been amended.
"Those are three primary changes in the tender document," Modi said.
"The new condition is that a $10 million advance performance deposit must be submitted 24 hours in advance, that is by 20th March. The bidders must be ready to give 10 percent of the amount that they bid within 48 hours post being awarded the franchise. So, in essence, we are going to back where we were in the first tender process when we did the new franchises [in 2008].
"Then the deposit was $5 million, but because the values have gone up, it has now been raised to $10 million. We have fixed the security at 10 percent of the bid amount," he added.
The IPL chief explained that the terms were amended because many interested bidders complained that the same terms and conditions are not applicable for people who bought franchises in 2008.
"The relaxation was done because we received letters from many companies who expressed interest and wanted to bid but said that the $1 billion criteria was not there in the first tender. The current owners of the teams don't have the criteria so why are we now putting that criteria for the new teams. Many more teams wanted to bid so we wanted to give them an opportunity to bid for the new teams."
Modi pointed out that the governing council was looking to increase the base price for the franchises, which is now priced at $225 million.
"The minimum bid price for the franchises remains the same at $225 million. We were looking to increase it and there was a lot of debate but we settled for that same price."