In an ironic twist for Pakistan’s franchise cricket economy, while the Pakistan Super League is experiencing an unexpected surge of valuation euphoria, its most paradoxical franchise, Multan Sultans, has been placed back on the auction block. Once again, the franchise that spooked investors is to be the focal point of a potential bidding war.
With the enormous amounts of money being paid for the new franchises, Hyderabad (Rs 1.75 bn) and Sialkot (Rs 1.85 bn), the PCB is seriously looking into the possibility of selling off Multan as soon as the law allows. The amount paid for those franchises was almost three times the price that was previously paid for Lahore Qalanders, who have been considered the top franchise of PSL. With this fact combined with Multan’s eight years of history on the field and a Championship win in 2021, the league is left with a difficult question: Is this the time to take the money now, or is this just the start of the valuation curve of the league?
When Market Euphoria Meets Timing
The PSL hierarchy believes the sale of Hyderabad and Sialkot has produced an extremely rare “seller’s market”. The half-serious comment by PSL CEO Salman Naseer to Chairman Mohsin Naqvi, “let’s auction off Multan as well, reflects this sentiment. While his comment was made in jest, he is also stating the economic reality that the prices paid for new franchises were almost three times greater than their historical average, which indicates that demand, particularly for foreign investors, is far outpacing supply.
From a business standpoint, Multan is a top-of-the-line franchise in a “hot” market. It brings the benefits of a pre-established brand, a high level of credibility, and a championship (2021) to any buyer. This will reduce the risks associated with ramping up to compete at a high level for any buyer. Also, from the PCB’s viewpoint, if they delay the sale, they may miss the peak of the valuation cycle.
An Established Brand, Not a Speculative Bet
Multan differs from both Hyderabad and Sialkot in its “proof-of-concept.” With eight years of PSL participation, one championship, and an ongoing body of fans that have grown with the team, Multan is a better investment risk than a new franchise, as this has value in sports franchises around the world (the IPL or NBA). Established teams almost always receive higher bids for their franchise rights than do new franchises because established franchises provide a predictable source of revenue.
League officials reportedly feel that a pre-Season sale will potentially price out the bid for Multan to be the highest-paid franchise in the league’s history. The officials’ view is based on logic – today’s buyers are no longer purchasing “potential,” they are purchasing “certainty.” In a league that is still developing commercial business, certainty is a rare product.
Strike Now or Wait for a Bigger Payday?
Multan Sultans is no longer just a team of cricketers; It is an economic indicator for the potential of the PSL’s future. Sell now, and you can make sure that the PCB will have the league at its all-time high value in history, and send a message to the global sports industry about how far along the PSL has progressed commercially. But wait, and there is the possibility that there will be a higher upside – but also a greater chance of failure.
The irony is so apparent that it should be impossible to miss; the team that was once dumped by investors could end up being the league’s most prized asset. The timing of the PCB’s decision (whether they move quickly or take their time) will define how the PSL is priced, funded, and regulated over its next ten years. This is not just about selling a team; it is also a test of what the PSL thinks it is worth.
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