Why Man Utd co-owner Avram Glazer’s billion-dollar interest in Indian cricket franchises makes sense

When the Glazer family bought Manchester United in 2005, even the biggest soccer sceptic in the United States would have (begrudgingly) admitted that the rest of the world appears to quite like the sport, the English Premier League is a thing, and, yes, OK, I have heard of Manchester United.

That same sceptic would also have to acknowledge that their investment in English football’s most famous club has massively paid off — for the Glazers, at least.

It took the Americans over two years to complete the purchase, and the final price tag was a shade under £790million, which equates to £1.4billion in today’s money, or $1.9billion. They borrowed most of that, and United have been paying the interest on those loans ever since. The Glazers have banked about £1.4billion in share dividends, management fees and selling minority stakes in the club. And they still own almost half of a franchise now worth almost £5billion ($6.8billion).

At the time of the takeover, Malcolm Glazer, the family’s patriarch and a self-made billionaire, was perceived to be the main protagonist. After all, he had bought the Tampa Bay Buccaneers in 1995 and had made several generations of Glazer very rich indeed.

But more recently, his son Avram has been given more credit for spotting the potential in sport beyond America’s shores. And the evidence for his central role in the United purchase has been growing. You can say what you like about his ability to run sports teams, but Avram can clearly pick a growth stock, as he has been eyeing up Indian cricket for at least five years.

In 2021, as reported by Sky Sports, he went too low when the Indian Premier League (IPL), the short-form cricket competition that launched in 2008, added two expansion franchises to an eight-team format. We do not know how much he bid, but the franchise that became the Gujarat Titans went for about $750million, and the future Lucknow Super Giants cost about $950million.

To those who had not been paying attention to cricket or India more generally, this auction was a ‘they paid how much?!?’ moment. But if Avram Glazer was shocked, he did a good job of hiding it. He bought the Sharjah-based Desert Vipers, a team that plays in a much smaller league in the United Arab Emirates, for $30million a year later and then tried to buy a franchise in English cricket’s Hundred competition last year.

He missed out on that one, too, but fellow American sports investors Todd Boehly and Tom Wagner did not. Cricket’s secret was clearly out.

Which brings us to what looks like Glazer’s third and fourth attempts to land an IPL franchise, as reports in India last week revealed he is among several bidders for the two teams on the block: the Rajasthan Royals and the Royal Challengers Bengaluru.

The Royals are owned by British-Indian businessman Manoj Badale, American private equity firm RedBird Capital and Lachlan Murdoch, son of media tycoon Rupert Murdoch. The Royal Challengers, the current IPL men’s and women’s champions, are owned by the Indian subsidiary of British drinks giant Diageo.

According to Indian sports business outlet The State of Play, the Royals should fetch something north of $1.2billion, while the Royal Challengers could cost as much as $1.8billion. Avram Glazer cannot own both, so he will have to focus on one when it comes time to enter into final negotiations, but for the time being, he can play two hands at once.

This might seem like an awful lot of money and effort for a team that only competes for just over two months every year, in a sport only played to a high standard in a dozen or so countries, and none of those are the U.S., in a league that plays its games when it is breakfast time in Florida.

But Avram Glazer knows what he is doing.

“This century, if you look at the top 20 global sports, cricket has been the fastest growing, and it is almost all to do with T20, its most simple and accessible format,” explains Gareth Balch, the chief executive and co-founder of global sports marketing firm Two Circles.

Launched in England in 2003, T20 took what most Americans still believe is a slow, strange sport that involves funny words, cream outfits and rain breaks, and turned it into a contest that lasts only a bit longer than a baseball game, with big hits, colourful clothes and fireworks. The Indians liked cricket already, but they absolutely love T20.

“The IPL is the biggest shooting star in global sport right now,” adds Balch. “The league’s franchise valuations have grown by a multiple of 10 since it launched in 2008, and that’s underpinned by the number of cricket fans. Demographics are destiny when it comes to sports investments, and India is looking like the best destiny.

“It’s already got the biggest population and its economy is growing fast, too. Cricket is rising on the tide of India’s growth. There are more sports fans in India than in any other country on the planet. And cricket is India’s first, second, third, fourth, fifth… you get the idea, no other sport comes close in popularity.”

India’s population overtook China’s in 2023. There are now 1.47 billion Indians on the planet, nearly 18 per cent of the world’s population. And its economy is now the world’s fifth biggest. But there is more to the IPL’s appeal to American sports investors than quantity; there’s familiarity, too.

“It has a lot of the same characteristics as the NFL, in that it has a huge domestic following and great TV deals, but it’s hardly touched the sides in terms of global growth,” says Amber Pinto, a partner at sports investment agency Pinto Capital.

“It also has what is known in business circles as a deep moat around it, which means the barrier to entry is very tough to cross. Franchises are expensive, but starting a new one would be almost impossible, given the start-up costs, and it would be difficult for any other league to compete with the IPL. So your risk of disruption is almost zero.”

Mike Fordham now runs his own sports consultancy, but helped to create The Hundred competition when he worked for the England and Wales Cricket Board. He then spent two years as chief executive of the company that ran the Rajasthan Royals and their sister teams in the Caribbean and South African T20 leagues. He agrees with Pinto.

“Like the NFL, (the IPL’s) got guaranteed profitability for its franchise-owners due to the size of the media revenues. Teams get an equal share of the $1.2billion-a-year media rights deal and — because it’s the biggest entertainment property in India — that’s likely to go up in about a year. It’s must-have TV content.

“There’s also guaranteed profitability because the players’ wages are controlled by a tight salary cap. So I’d imagine that Glazer sees it like he looks at his teams in the NFL and Premier League, as one of the biggest brands and a fantastic asset to add to his portfolio.”

Andrew Umbers is a partner at Oakwell Sports Advisory, the London-based firm that helped Indian media conglomerate Sun Group buy a stake in a Hundred franchise last year.

“American investors like the IPL because it’s a closed league, so there’s no promotion or relegation, and it has strong financial regulation and an equitable commercial model,” he explains.

“That’s why we’re seeing them increasing their links to global cricket through their investments in (the still very small, U.S.-based) Major League Cricket competition and beyond.

“But there is another factor at play here, and that is the growing south Asian population in the U.S. itself.”

Balch agrees and makes the point that this growing American demographic also has financial firepower.

“Just look at who is investing in cricket in America: they are the CEOs of Alphabet, Microsoft, Adobe, IBM and YouTube, just to name a few. All of Indian descent and all cricket mad.”

Umbers also notes that cricket’s governing body, the International Cricket Council (ICC), has had its eyes on the American market, too, which is why it pushed so hard for T20’s inclusion in the program for the 2028 Olympics in Los Angeles.

And if the ICC wants something to happen, it is because Indian cricket’s governing body, the Board of Control for Cricket in India, wants it to happen.

“India is by far cricket’s biggest market — it accounts for 87 per cent of the ICC’s broadcast and commercial income,” explains Umbers, who strongly believes that the IPL and the other big national T20 leagues are only going to get more powerful within the game in the coming years.

Oakwell estimates that the average IPL franchise will earn more than $150million a year by 2031, more than double current earnings.

For Pinto, the investment thesis is very simple.

“Cricket is the second biggest sport on earth and yet has hardly penetrated the U.S. market. But it will.

“When you combine cricket’s growth with the macro situation in India — its economic growth and the possibility of an Olympics in India in 2036 — this is a huge opportunity.”

So, perhaps the real question is not ‘why is Avram Glazer trying to buy an Indian cricket team?’, it is ‘why isn’t every other American billionaire who likes sports trying to buy an Indian cricket team?’

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