CHENNAI, March 21: The market meltdown and economic recession looked like things of the past as the financial strength of the Indian Premier League received a huge boost with two new franchises paying a phenomenal $703 million (over 10 years) for the city of Pune and Kochi.

Long-time BCCI associate, Sahara (Sahara Adventure Sports), chose Pune as their base city after having bid successfully for Ahmedabad, Pune and Nagpur.

The other winning bid of $333 million was from less known Rendezvous Sports World (Kochi), a consortium comprising many business houses that had bid only for Kochi, a city that was also a surprise winner. IPL commissioner Lalit Modi made the announcements at a city hotel here on Sunday. Significantly, the bid amount for the two additional teams that will take the total number of franchises in IPL to 10 is greater than what the eight franchises bid for their teams back in 2008. The auction in 2008 saw the BCCI-IPL realise a total value over a 10-year period at Rs 2,840 crores while the two new teams alone have a value of Rs 3,235.53 crores. The dollar price when the existing companies bid was at the exchange rate of Rs 40 to the US dollar while the current exchange rate is Rs 46. The auction process was to have been completed on March 7 but got postponed by two weeks after the bidders and the BCCI objected to stiff financial clauses. The bidders who did not succeed were the Videocon Group and the Adani Group.

“The bidding was extremely competitive and I hope the bidders make good business. The franchise fee for the two new teams will be for 10 years,” Modi said. The Jaypee group and Pune-based builder Anirudh Deshpande, Bollywood actors Ajay Devgan, Sanjay Dutt and Suniel Shetty were all interested parties, who had reportedly purchased tender documents. The clause requiring the bidders to have a net worth of $1billion was removed after most of the bidders objected to it. The minimum bid amount, however, remained at $225 million.

The city of Pune received a total of three bids. Amman Nora bid $261.30 million while Adani enterprises stood at $315 million. VC Digital Solutions Pvt Ltd (Videocon) also bid for Pune at $319.90 million. Sahara will have their new home ground on the outskirts of Pune (Gahunje on the Mumbai-Pune expressway). The construction is already underway and the stadium should be ready by March 2011, well ahead of the IPL-4. The Kochi bid had the blessings of the Union Minister of state for External Affairs, Shashi Tharoor, who had wished to see his home state get a cricketing boost with a franchise.

But the team is likely to play outside Kochi until the city can get its own international standard cricket stadium.