PSL franchises ask PCB for financial relief to cover losses

Updated January 11, 2020

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All 34 matches of PSL will be held in Pakistan instead of in UAE which will boost the chances for more profit from this upcoming edition. — DawnNewsTV/File
All 34 matches of PSL will be held in Pakistan instead of in UAE which will boost the chances for more profit from this upcoming edition. — DawnNewsTV/File

LAHORE: A majority of the franchises of the HBL-Pakistan Super League (PSL) are demanding financial relief, claiming that they are suffering big losses but are reluctant to submit their financial statements to the Pakistan Cricket Board (PCB) to prove the losses incurred, well-informed sources told Dawn.

It was learnt that while the PCB has been considering the demands of these franchises, the Board feels that it is not possible to evaluate the reality of the losses claimed by franchises without being privy to the financial statements of the franchises.

According to reliable sources, only Peshawar Zalmi and Islamabad United have provided their management accounts post 2017 PSL edition.

It must be mentioned here that in 2020, all the 34 matches of the PSL will be held in Pakistan instead of in UAE which will boost the chances for more profit from this upcoming edition.

In the first four editions, the PCB held majority of the matches in the UAE and only a few in Pakistan. But the PCB is hoping for a handsome profit in the 2020 edition since thousands of people are likely to fill the stadia in the cities where the PSL matches will be held.

Besides, the PCB will also be saving a lot of money as they will not have to spend millions of rupees in hiring the stadiums which was the case in the UAE and there will also be much less travel expenditure due to home matches. So overall, the franchises will also fare much better financially by playing all matches in Pakistan, the sources said.

Meanwhile, in order to meet the demands of the franchises, the PCB will have to make changes the original agreement signed with them for a period of 10 years. Whether the Board of Governors of the PCB will give go-ahead to the changes in the original contract to give benefit to the franchises remains to be seen. The matter could likely come up in the next meeting of the BoG scheduled to be held in Peshawar later this month.

Moreover, the franchises are demanding of the PCB not to ask for submission of the bank guarantee which was a key condition in the original agreements with the franchises. Dawn has learnt that the franchises have proposed to submit post-dated cheques as an alternative to bank guarantees and in case any of those cheques are dishonoured, they can submit bank guarantees for the next two years latest by April 1 of that year, when the PSL’s schedule of the matches will have been concluded.

It is also learnt that the PCB has already received some security through post-dated cheques instead of the bank guarantees, which if true is a violation of the original agreement.

Moreover, the franchises have also requested not to apply the foreign exchange rate for payments due under the franchise agreement which gives some relaxation due to unforeseeable currency depreciation. In principle, the PCB has agreed to set Rs.138.60 for one US Dollars as the minimum benchmark, which existed when the sixth franchise Multan Sultans was sold out.

However, despite the above-mentioned arguments put forward by the franchises, the PCB acknowledges that the franchises have played a positive role in bringing back all the matches of the PSL to Pakistan.

However, an opinion will be sought from an independent financial consultant. The PCB estimates a burden of Rs 5 to 6 million as a consultancy fee in this regard, from which it will bear 1/7th of the total cost. In the market, currently one USD is valued at Rs 155 plus.

The franchises have also demanded for in-stadia activation opportunities for their sponsors, which is a right that was not part of the original ITT on the basis of which the franchises were sold.

Published in Dawn, January 11th, 2020