Bollywood actor Shah Rukh Khan is acquiring a 50% shareholding in one of India's oldest and most successful football clubs, Dempo FC, for around Rs 30 crore, signalling the movie star's growing interest in the business of sports.
Negotiations are at an advanced stage and the deal should close in a week or two, officials from both sides confirmed. Khan, whose cricket team won this year's Indian Premier League, confirmed he is buying the club, but refused to share details.
People familiar with the negotiations said Khan was not the only one bidding for a piece of the football pie. An ace Indian cricketer, known to be a keen footballer himself, and a few corporate houses had also thrown their hats into the ring.
But Khan has emerged as the leading suitor, the officials said. Dempo, fully-owned by a business group of the same name in Goa, made history in April this year when it won the I-League crown for a record fifth time. It recently bought a 34% stake in leading Danish soccer club and academy FC Midtjylland, for 12 million euros.
The owner of Dempo FC, Shrinivas V Dempo, whose grandfather adopted the club four decades ago and nurtured it, confirmed that he had met Khan several times and the talks "have been very positive, though not yet closed". He said the winner will not get a majority stake in the club, which will retain its name.
People close to the deal said the club, being old and successful, is roughly valued at about 50-60 crore.
Khan, who co-owns Kolkata Knight Riders, the winner of IPL-V, has been a keen sportsman since school days. He has been trying to diversify into sports under the overall framework of the entertainment business run through Red Chillies Entertainment.
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It could not be ascertained if Khan was routing his potential investment in Dempo through Red Chillies, which is also an investor in the Kolkata IPL franchisee.
What Khan brings to the table is his personal brand equity, which, sports observers say, will help not only Dempo, but also Indian football gain traction both on the field and on television. Khan's entry into the soccer club could bring in more sponsors and advertisement money. The world's most popular game has not been a very profitable proposition in India, where cricket rules the roost.
Dempo spends close to Rs 12 crore a year to run the team. The club recently lost its star goal scorer Ranti Martins to Kolkata's Prayag United, since he had demanded a paycheque of Rs 2 crore.
Dempo, managed by 58-year-old Armando Colaco since 2000, has ended the stranglehold of the Kolkata giants - Mohun Bagan, East Bengal and Mohammedan Sporting - over Indian football. Continuity has helped Colaco and his players win a record five national championships over the past decade.