Lalit Modi Profile

Sharp, brash, ruthlessly ambitious, and admired and reviled in equal measure, Lalit Modi
changed the landscape of cricket before exiting the stage controversially, and as
dramatically as he entered it. The Indian Premier League, the multi-million-dollar, football-
style, franchise-based domestic league, which Modi conceived and executed with
spectacular success, has hurtled cricket to the fast lane, forcing the traditionalists to follow
suit even while squirming. The tournament, first held in 2008, consolidated India's position
as cricket's economic powerhouse, and consequently, its premier agenda-setter.
Modi's rise to the top rung of Indian cricket was as fast as it was stunning. Scion of a leading
Indian business family, he began his career as an adversary of the Indian cricket board in the
early 90s when he was trying to build a business out of distributing sports pay channels. He
knew even then that live sports was one of the few things the Indian television consumer
would pay for but soon realised the best way to beat the system was to join it. However, it
was not until 2005, when he became the youngest vice-president of the BCCI, that he came
into prominence. He soon became the driving force of the board's commercial activities and
pushed its revenues over the US$1 billion mark. His abrasive and confrontational approach -
- among other things, he accused the ICC of harbouring a neo-colonial bias -- didn't win him
many friends in international cricket and there were rumblings of opposition within the BCCI
as well. The end came from an unexpected controversy - revelations over the auction of two
new IPL franchises - and was swift. Fifteen days after his initial indiscreet tweet Modi was
served his suspension notice by the BCCI, ironically moments after an emotional closing
ceremony to the 2010 IPL final. The fallout has been messy and prolonged, with Modi taking
on his former bosses at various legal and institutional levels, ensuring he remains in the
headlines.

MUMBAI MOVE
Since Lalit and Minal’s wedding had caused such a stir in social circles in Delhi, the
new bride soon discovered that she didn’t have much company because not too many
of her childhood friends were very forthcoming.

The couple decided to move to Mumbai, where they first lived in KK Modi’s flat at
Sterling Apartments on Pedder Road. However, by the time Lalit’s family grew -- son
Ruchir and daughter Aliya joined step-daughter Karima Sagrani -- they had first
rented, and then bought Minal’s father’s house in Juhu, which was rented out for
film shootings until they moved in.
This house, where the Modis lived for more than ten years, caught fire in December
last year and is currently under repairs. There have been some allegations of arson
for claim insurance money, but so far they remain unsubstantiated.
THE TURNAROUND
While Lalit Modi was living in Mumbai, sources said he still received a maintenance
allowance from his father’s company because his own businesses were consistently
failing. Things started to turn around, however, once Lalit’s friend Vasundhara Raje
took over as Chief Minister of Rajasthan.

Lalit knew Raje though her school friend Bina Kilachand, who had moved to Jaipur
with her. Lalit Modi followed soon after, hoping his proximity to the CM would help
him set up a profitable business. Soon after he shifted to Jaipur, Raje and Kilachand
allegedly had a big falling out. Lalit stayed back as one of Vasundhara’s closest allies
and his reputation as an alleged wheeler-dealer started to grow.

While in Rajasthan, he not only took over the cricket establishment with the help of a
law passed by the new government, but his alleged involvement in the sale of some
heritage havelis created a storm and is now being probed.

Modi’s alleged involvement in the scam was raised by Congress MLA Ramnarayan
Meena. Rajasthan Tourism Minister Bina Kak had said that an inquiry would be
immediately ordered. Jaipur Divisional Commissioner Kiron Soni Gupta, who
headed this inquiry, submitted the report on the subject to the government recently.

Things took a dramatic turn for the Modis, however, after he entered the BCCI -- first
as a dealer who helped the Pawar group defeat Jagmohan Dalmiya -- and then as a
money-making wiz who finally came good business-wise. The BCCI’s profits soared
over a billion with Modi in its midst, and his brainchild, the IPL, took cricket’s
economics to a different level.
FAMILY TIES
Lalit Modi’s family members have some connection with the IPL, with some owning a
stake in the teams, while some own broadcast rights for matches

Lalit Modi’s family and friends, most of whom have already featured in this article, are an
integral part of the IPL.
Minal’s sister Kavita is married to Suresh Chellaram, who owns a majority share in the
Rajasthan Royals franchise.

Lalit’s step-daughter Karima is married to Gaurav, son of Monica and Vivek Burman of the
Dabur group. The marriage caused a stir in the Burman family similar to the one in the Modi
family when Lalit and Minal tied the knot. The Burmans have distanced themselves since
then from Gaurav, who first lived in London but now stays in a disputed four-bedroom flat
on Sir Pochkhanawala Road, Worli, rented for Rs 600 a month by Godfrey Philips from a
Parsi trust.

Gaurav is a stakeholder in Global Cricket Venture, a firm that has the digital, mobile and
internet rights of the IPL. His brother Mohit Burman is a co-owner in Kings XI Punjab, which
he owns as part of the consortium consisting of his childhood friends Karan Paul and Ness
Wadia, and Wadia’s ex-girlfriend Preity Zinta. The franchise, however, is up for sale now.

BCCI officials say that Modi did not disclose any of these relationships with franchise
stakeholders at the time of the bidding for the first eight IPL teams.

Incidentally, one of the owners of Kolkata Knight Riders is also an old friend of Lalit Modi’s.
Jay Mehta, son of Mahinder Mehta who owned Saurashtra Cements, and Lalit are childhood
buddies.

SARDINIA TO BEL AIR?
Those in the know reveal several details about how Modi’s lifestyle has changed over the
last three years. To start with, he has been going on lavish holidays to the most exotic
destinations in the world. In Sardinia, in the Italian Riviera, he allegedly rented a boat in
which he invited several friends from India, including some senior politicians.

Then, the Modis have been spending the Christmas vacations in Phuket’s Aman Resort for
the last few seasons with friends and family. In 2008-09, they allegedly went to Mexico,
where they rented Jimmy Goldsmith’s home. Goldsmith was the billionaire father of Imran
Khan’s ex-wife Jemima.

Around that time, Minal Modi was diagnosed with breast cancer and Lalit reportedly rented
a mansion in Bel Air, one of Los Angeles’s poshest suburbs for stay during her treatment.

Karima and Gaurav Burman also stayed in the house until Minal bounced back from the
illness.

Aside from this spending, it is his private jet, which he uses for most of his travel needs
these days — including the IPL match in Dharamshala and the ICC meeting in Dubai recently
— that has come under special scrutiny. Not only because it raises aspersions of
unexplained assets but because the aircraft has become a bit of a joke in social circle.

“Is it a plane or a taxi?” asked one source. “Private jets are usually used judiciously, even by
the biggest industrialists. They are for work, not pleasure, and they’re supposed to help by
getting you to far-off places quickly. No one, except Lalit Modi these days, uses it as a
replacement for all other means of transport,” the source added.

The word is that Lalit Modi’s extravagance is a retaliation for all the years when he was
looked down upon by other families in their social circle. “It was in his nature to be loud, but
he never got a chance,” a source said. “The only problem is that overdoing things has got
him in trouble now.”

Lalit Modi: A peek into the mind of a brilliant marketing marvel
This week I received a call from a journalist who wanted to discuss the danger to cricket
with Lalit Modi’s return to Indian cricket, if at all. He further questioned the Board of
Control for Cricket in India’s (BCCI) overreaction to Modi’s possible victory in the
Rajasthan Cricket Association elections last month.

Now in any democratic polity, a viable opposition is paramount for its effective
functioning. Over the years whenever the BCCI has lacked an effective opposition, the
functioning has deteriorated. This is detrimental for the game and the institution. At this
point of time there is no opposition to N Srinivasan, with the result that he is making
decisions that are not in the interest of the game.

What possible danger can Modi pose to cricket? He will be a good opposition to have.
And anyways to write off Modi would be an act of ignorance at one’s own peril. As far as I
know him he is a fighter and would fight till the bitter or sweet end.

It feels just yesterday that I first met Modi. And, surprisingly enough, his career in Sports
Administration began on the opposite side of the table, when he was trying to build a
business out of distributing sports pay channels in India. I think then he was perhaps the
only individual that had realised early on that the business of sport was unlike any other
having the ability to ‘cut across all creeds and all castes’, which is why he decided to bring
televised cricket through ESPN and then Ten Sports to India.

He knew even then that live sport was one of the few things that Indian television
viewers would soon mature and agree to pay. Lalit knew even then the value of the
broadcasting rights. About a decade ago, in one of his first meetings with me, he
prophetically told me nobody was marketing cricket in India the right way.

Next I knew with ESPN he had gone about buying the broadcast rights of the English and
Wales Cricket Board (ECB), the BCCI, Cricket Australia, Cricket New Zealand, West Indies
and Sri Lanka. And interestingly enough I remember Mr. Jagmohan Dalmiya, telling him:
“You are foolish. You are paying us so much money.” ESPN then had signed a contract for
US$12 million. Indian cricket had never seen such money in those days. This was a man
who could do many good things for Indian cricket and so I took him under my wings to
help improve cricket in India. And the best way to improve the system is to join it. A
decision was taken and Lalit’s tryst with Indian cricket began in earnest then.

Soon after, I distinctly remember a headline run by the Indian Express on February 22,
2005 titled, “RCA Modi-fied: Rungtas run out on 38” heralding what would be Lalit’s
eventful entry into Rajasthan cricket and through that into the BCCI.

The implications of the result that day, were to find an echo later that year when the
BCCI election took place and Lalit more than lived up to all his promises made to the
Board.

As early as March 2005, I remember Modi making the following statements publicly in an
interview with theOutlook magazine:

 The value of Indian cricket is at least $2 billion in the next four-five years.”
 “Indian cricket can be as big as the NBA (the basketball league) in the US.”
 “An Indian Test player can earn as much as Michael Jordan used to: $40 million a year.”

Intriguingly enough, the magazine at that time had chosen to term these prophetic
statements as “Strange new sounds emanating from the edifice that is the Board of
Control for Cricket in India”.

But I was convinced by Modi, even then about the brand potential that was Indian
cricket.

Next, I remember November 29, 2005 as if it were yesterday. It also happened to be
Modi’s birthday, when a new chapter was written in the annals of Indian cricket. Under
the visionary leadership of Mr. Sharad Pawar a new team took office. Improving
infrastructure, marketing the game correctly to monetise it, settling the all -important TV
rights issues, new player contracts, finding a suitable team sponsor, and bringing
transparency and professionalism into the functioning of the BCCI was the simple agenda
laid out then by Mr. Pawar. And Modi, as one of the youngest-ever BCCI Vice Presidents,
took up the challenges whole heartedly.

It was Modi’s dream to make “Indian cricket the most powerful brand in world sport” and
one that he took up in earnest post November 2005.

Having identified the potential revenue streams, Modi emphasised to the BCCI the
importance of the need for implementing an open bidding process for any property. Next
he went about virtually single handedly collating and analysing all past data on BCCI
prices and arrived at a hypothesis that all the old data was irrelevant, because cricket in
India was getting undersold.

First of the blocks in December 2005 and a litmus test for all Modi’s assumptions were
the team sponsorship rights tender. The Sahara Group had earlier paid the BCCI a mere
Rs. 78.10 crore for Team India’s sponsorship for three years. If I remember accurately
close to 12 corporates purchased the bid documents, while six — Indian Oil, Hero Honda,
Reliance Infocom, Air Sahara, Idea Cellular & Airtel — qualified. Amongst these, Hero
Honda had not participated in the final bidding. Finally, through a fair and transparent
bidding process Air Sahara had won the Team Sponsorship rights for a whopping Rs.
313.80 crore almost quadrupling the revenues the BCCI had received the last time
around. In fact, even all the other five bidders that had qualified had bid over Rs 250
crore each, validating Lalit’s hypothesis. And incidentally, this was only for the logos on
the player’s chest and leading arms. There were more revenues to come from the
sponsorship of logos on the player non-leading arm and apparel/kit sponsor. Times of
India had summed it up best when they said on December 20, 2005 shout out “Cricket
business just got 300% bigger”.

But Modi was confident even then that his role of unbundling the value for the BCCI and
Indian cricket had only just begun. Next on his agenda was the official kit sponsorship
deal, and the eight-figure sponsorship deal that we bagged for Team India and the BCCI
certainly did raise a few eyebrows. Reebok, if I remember correctly, had offered us US$26
million, only to be topped by a US$28 million bid from its soon-to-be-sibling Adidas.
Adidas, in turn, was bested in dramatic fashion by a US $44 million cheque from Nike.
And I remember announcing that the Rs. 196.66 crore winning bid had made Team India
the “world’s most valued brand in team sponsorship.”

Nike was Indian cricket’s official kit sponsor for five years and also agreed to sponsor the
player’s non-leading arm with their ‘swoosh’ logo from January 1, 2006 till December 31,
2010. Nike also became the official licensee for all apparel merchandise of the BCCI. All
Lalit had done with Nike was simply work on the brands eagerness to break into an
emerging market like India.

But the coup de grace for Modi, and perhaps the BCCI, was the all-important television
broadcast rights.

He brought all his learning’s to bear during the all-important Television Broadcast Rights
of the BCCI. He knew the television companies’ balance sheets inside out and it was
incredible to watch him simpl -`y call everybody in and played one against the
other. Importantly, it was Modi’s experience that had helped him arrive at a base price of
US $ 430 million — which once again made many of my detractors publicly ridicule his
business acumen!

Net Result: Nimbus Communication bagged the coveted Global Medi a Rights of the BCCI
for a gargantuan US$ 612.18 million from March 2006 to March 2010 in February 2006. I
distinctly remember a Times of India report dated February 18, 2006 titled “BCCI scores
Rs. 3354 crore and still batting” – wherein the journalist had very succinctly put in a
comment that even if the BCCI had broken up its bag of goodies and given it to different
bidders the aggregate would have been less than what Nimbus had bid. Other headlines
then in newspapers like the DNA had stated “BCCI makes a killing on cricket rights” and
even the International Cricket Council (ICC) had remarked “full credit to the BCCI for
being able to monetize the eyeballs well”.

Some media analysts even then had said that the bids were too high and everyone worth
their salt had begun to break down the numbers to understand the return on investment
(ROI) for Nimbus.

It was then that the BCCI was perceived globally as an influential powerhouse, capable as
anybody else, in shaping what international cricket will look li ke, and feel like, in the
years to come. And all those accolades in my mind were for one person and one person
alone — namely Modi.

Incidentally, in the four years prior to the arrival of Mr. Pawar’s new regime and Modi,
the BCCI’s income was estimated at U$67m and within a matter of a year the BCCI had
passed revenues of over US$ 1 billion.

Modi did not stop there; he then turned his attention to improving the level of cricket
and its infrastructure in his home state of Rajasthan. The Rajasthan Cricket Association
under his leadership opened the doors to a spanking new Cricket Academy, which was
truly state-of-the-art and even today is looked at by many a cricket administrator as a
Global Centre of Excellence in Cricket. Next Jaipur’s Sawai Mansingh Stadium was
completely refurbished and modernised for the new Indian cricket fan. In fact, I have no
doubt in my mind that it was these changes instituted by Modi in terms of giving the
Rajasthan cricketers the very best-in-class global facilities, that helped the state of
Rajasthan win their maiden Ranji Trophy crown in 2011.


The IPL journey

Interestingly, all through this, while Modi had festered a personal dream of an Indian
sports league that would be the envy of the sporting world. He dreamt that our national
sporting passion — cricket — would captivate fans all over the globe. And as his efforts
with the Marketing Committee were noticed by all and sundry, Modi mustered up the
courage to present his plans of an Inter-City Professional Cricket League to the BCCI, once
again.

It was just about this time that a shorter, more entertaining version of cricket was gaining
worldwide appeal. Twenty20 cricket was fast emerging as the “perfect blend of sports
and entertainment”, it also featured loud music, dancers, cheerleaders, and wired-up
players providing commentary on the game even as it was being played.

Cricket purists had scoffed at the gimmicks and felt that Twenty20 was a travesty. The
format, nonetheless, proved to have great appeal in England. As experts decried the
technical inelegance of its play, spectators enjoyed being able to watch a complete game
in three or four hours.

I remember, Modi coming to me one day and reading out something Ayaz Memon, the
then Sports Editor of DNAhad written about Twenty20: “Sponsors will drool, the game
has found favor across age groups, and more significantly, across genders. It could even
emerge as a potent challenge to Bollywood because it lasts just about three hours.”

Modi felt Ayaz had got it right.

Modi then set about actually studying myriad business models of sporting leagues in the
United States and Europe and set aside their strengths and weaknesses. It was post this
preliminary investigation that he attempted to put together what best-suited cricket in
the global context. The final product was then designed with all the safeguards put forth
for all our stakeholders and players. And the Indian Premier League (IPL) was born — at
least in Lalit Modi’s head.

With his homework done, Modi then approached the BCCI, outlining the vision and plan
and for the IPL. And I also remember Mr. Sharad Pawar, after a few consultations and
queries, handed over to Modi a clearance of nearly Rs. 200 crore and a free hand to turn
his dream into a reality. The money was approved by BCCI for Modi to use as seed-capital
to help recruit cricket players to the IPL, but even then the murmurs of some nay-saying
colleagues were quite audible. He never used the said amount, but instead astonished
everyone by bringing in billions of dollars before spending anything.

A lot many said that the league was doomed to fail, but Modi was determined to prove
them wrong. The real work to get the league off the ground had only just started for
Modi. The IPL, after all, was meant to be something totally new, and to build it He had to
constantly deal with much risk and uncertainty.

Within a few days of getting the BCCI’s approval Modi held a formal media briefing in
New Delhi, to let the world know that the IPL was just seven months away from its first
match. I asked him then, why the announcement at a time when he did not have a single
player signed up, let alone an Indian corporate ready to stake their money on a sporting
franchise. He said, “Bindraji, perception, perception and perception will be key to our
success.”

Importantly, the world though stood up and took notice.

Modi then meticulously set about signing the top 100 international players in the world.
He knew that for the IPL to succeed he just had to sign up the very best in International
cricket. I remember Modi classified the top 100 players in the world into four categories,
based on their annual earnings and skill levels and decided to offer minimum salaries of
US$ 100,000, US$ 200,000, US$ 300,000 and US$ 400,000 to players in the different
categories. In all, he was willing to offer $20 million for the top 100 players in the
world. Armed with that he started speaking to many players, and would you believe
Lalit signed up all the Top 100 players with all of one – YES ONE IPL employee!

Next, Modi turned his attention to bagging the all-important Broadcaster, who would
actually help fund the IPL through the Media Rights. I distinctly remember that his initial
discussions with several TV broadcasters in India and abroad had not been very
promising. Broadcasters had reasoned that LIVE TV coverage of the IPL was feasible only
if the matches could deliver an average of five rating points per game. Thus it all boiled
down to when the IPL matches were played, and the audiences they delivered. None of
the existing Sports Channels believed this could work.

He believed only Prime time television had the potential of delivering these kinds of
audiences in India. There again most Indian households had a single TV, and there was a
risk that a prime time IPL broadcast not garnering the potential audiences unless it was
compelling enough to attract a broad audience. Secondly cricket matches starting at 8.00
PM at night was scorned at by many, and unheard off. Unperturbed by all these
questions, Modi went ahead with the Global Media Rights Invitation to tender and after a
fair and transparent bid process was pleasantly surprised at the amount of the winning
bid.

The rights had been bought by the World Sports Group, who were the only bidders and in
turn sold to leading sports broadcaster Sony Max through to 2017. No other Broadcaster
bid for IPL. It was WSG a Lagadere company only that bid. With a broadcasters bid of a
whopping USD $ 1.026 billion, the IPL had well and truly become a billion dollar baby
without a single ball being bowled. Incidentally ESPN did bid but offered no Money. Sony
withdrew their bid.

With the broadcaster on-board things were now ripe for the IPL to go look for its right
franchisees and a Title Sponsor for the league.

Modi personally went around from office to office of prospects, making PowerPoint
presentations to Indian corporates and businessmen with a request to come aboard as a
franchisee. That is when Modi once again thought of mixing two of India’s favorite pass
time Cricket and Bollywood. I thought that mixing the glamour of films with the fast -
paced action of Twenty20 was a possible masterstroke.

He personally spoke to Shahrukh Khan, an old friend, about buying a franchise. Shahrukh
was interested, but confessed to knowing next to nothing about cricket or franchising.
Then, on a visit to Thailand over the New Year break, I received a call from Modi saying
that he had met Preity Zinta, vacationing in Phuket with Ness Wadia and they too could
be interested in buying an IPL franchise.

By then Modi’s approaches to big business conglomerates like Reliance Industries and the
UB Group were also beginning to pay dividends as both Mr. Ambani and Mr. Mallya had
immediately agreed to come aboard. We had some traction, but still a long way to go.

From then on, Modi personally made it his agenda to meet and explain the investment
rational of the IPL to prospective franchisees. Sometimes literally flying around the
country in an effort to get buy-ins. Those were some tough days indeed and without the
IPL’s eight franchisees it would have been a non-starter. I think that the Media Broadcast
Rights won by Sony Max & the World Sport Group a week earlier, with the broadcasters
bid of US $ 1.026 billion did miracles in terms of getting prospects to believe in the IPL.

A fair and transparent bid process on January 18, 2008 saw the likes of Shah Rukh, Preity,
RIL (Mukesh Ambani), GMR Holdings, UB Group, Indian Cements Ltd, Deccan Chronicle
and Emerging Media emerge winners for the exclusive Franchise rights for the eight city
league.

Winning Bidder City Franchise
Won
Winning Bid
Value

India Win Sports Pvt Ltd (Mukesh Ambani) Mumbai USD 111.9
Million
GMR Holdings Delhi USD 84 million
Shah Rukh Khan/Juhi Chawla/Jay Mehta Kolkata USD 75.09
million
Indian Cements Ltd Chennai USD 91 million
UB Group Bangalore USD 111.6
million
Preity Zinta / Ness Wadia/Karan Paul/Mohit
Burman
Mohali USD 76 million
Deccan Chronicle Hyderabad USD 107.01
million
Emerging Media Jaipur USD 67 million


Hunt for a title sponsor and other sponsors

He then got down to scouting around for a Title Sponsor and other Co-Sponsors to build
the Central Pool Revenues for the BCCI and our eight other franchisees.

Once again Modi hit the road armed with a sales pitch to bring on board the all -important
Title Sponsor for the league. In mid-February, we opened the bids for the Title
sponsorship of the IPL and DLF won the same with the highest bid of Rs. 40 crore per
annum for a total sum of 200 crores. The deal gave DLF Ltd., exclusive Title Sponsorship
rights for a period of five years.

Next up on Modi’s agenda was the all-important IPL player’s auction. The rest, as they
say, is history. From there on end, Modi was simply unstoppable looking into each detail,
micro-managing everything. And when Brendon McCullum got the tournament off to an
electrifying start with his 158 at Bengaluru, all I could remember that night was a
beaming Modi — like a parent smiles at the birth of his or her baby.

All said and done, all I would say of Lalit Modi is that he is a sharp and a hands-on
administrator. A very good communicator; very clear about what he wants to do or
achieve, charismatic and capable of carrying people along. Always bubbling with energy,
his own set of ideas and opinions. Simply put, he is a go-getter. Whether you agree with
him or not, he had a charisma and the marketing acumen to set the world alight with his
achievements. And you would only ever write Modi’s epitaph at your own peril. A case-
in-point is his re-election to the Rajasthan Cricket Association which could well see Modi
take guard for a potential second innings and one can only wonder what this marketing
maverick will do from here on. I am only too hopeful for what the future holds for Lalit
Kumar Modi.