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Where are the sponsors?
CWG
OC Struggling To Raise Rs 1,600 Crore To Repay Loan
TIMES NEWS NETWORK
http://epaper.timesofindia.com/Daily/skins/TOINEW/navigator.asp?Daily=TOIBG&showST=true&login=default&pub=TOI
New Delhi: Will the 2010
Commonwealth Games’ Organising Committee (OC) be able to repay Rs 1,600
crore it has taken as loan from the Centre to host the mega event? OC’s
reply to an RTI filed to find out the amount of money so far raised from the
sponsorship of the Games, paints a grim picture.
With just four months to go for the Games, the OC has
been able to raise just Rs 243 crore through sponsorship deals. Sponsorships,
apart from television rights, are expected to form the major chunk of money
for the organisers, who are also expecting to raise some money through
merchandising and ticket sales.
According to OC’s reply to the RTI on May 11, it
has on board only five sponsors — Air India, NTPC, Hero Honda, Central
Bank of India
and Coca Cola — for the Games so far. It has raised Rs 143 crores in
cash from the sponsors and got Rs 60.70 crore in kind. Another Rs 100 crore
has been promised by the Indian Railways.
OC has roped in Australian firm Sport Marketing and
Management Private Limited (SMAM) as its advertisement consultant, in charge
of bringing in sponsors for the event. SMAM was a consultant at the 2002
Manchester Games and 2006 Melbourne Games too. The firm is working on a
commission basis and it’s commission, according to OC chairman Suresh
Kalmadi, varies from 20 to 25 per cent of the deal amount.
“They had asked for commission touching 30 per
cent, but after negotiations it was worked out between 20 to 25 per cent,
depending on the amount they bring in,” Kalmadi had told ToI recently.
Kalmadi has admitted that both Melbourne and Manchester
Games did not get many multinational sponsors, an indication that the OC may
also lose out on that front. This means that it would be even more difficult
for OC to raise money to repay the government loan. When asked whether SMAM
has been able to rope in any local sponsors, Kalmadi said: “All, except
the Railways.” This means that 25 per cent of Rs 143 crore so far
raised will go to SMAM, leaving OC with only Rs 107.25 crore.
TV rights deals, the next big hope of fund generation,
have more or less been sealed. Deals with the likes of BBC in United Kingdom,
Network Ten and Foxtel in Australia, South African Broadcasting Corporation,
TV New Zealand, Cyprus Broadcasting Corporation, Seychelles Broadcasting
Corporation, ABU in Malaysia,
Broadcasting Organisation of Nigeria, Namibia
Broadcasting Corporation and others are believed to have generated close to
Rs 300 crore.
Merchandising and tickets sales are unlikely to generate
a huge amount of money, which could leave OC in heavy debt after the Gamnes
are over.
“We are hopeful of
getting a lot of money. We hope to cover the deficit,” was
Kalmadi’s answer.
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