New Delhi, November 5: Diageo, the parent company of the Royal Challengers Bengaluru (RCB) franchise in the Indian Premier League (IPL) and Women’s Premier League (WPL), has announced it is undertaking a "strategic review" of its investment in the franchise through Royal Challengers Sports Private Limited (RCSPL). This move marks the initial steps towards potentially divesting its stake in the team.

RCB has enjoyed notable success recently, clinching the WPL title in 2024 and triumphing in the IPL this year by defeating the Punjab Kings in the final.

According to reports from a sports news outlet, Diageo disclosed in a filing with the Securities and Exchange Board of India (SEBI) that this review is anticipated to conclude by March 31 of the following year.

RCSPL operates as a wholly-owned subsidiary of United Spirits Ltd, which is under Diageo's ownership.

Praveen Someshwar, Managing Director and CEO of United Spirits, stated in the SEBI filing, "RCSPL has been a significant and strategic asset for USL; however, it does not align with our core alcohol and beverages business."

He further emphasized that this decision reflects USL and Diageo's dedication to evaluating their portfolio in India to ensure long-term value for stakeholders while considering the best interests of RCSPL.

This strategic review comes at a time when Diageo is facing challenges in its primary global beverage business, which has encountered considerable pressure in recent years. Earlier this year, the company refuted rumors regarding the sale of RCB, with USL's company secretary Mital Sanghvi labeling such claims as "speculative."

Speculation regarding a potential divestment has grown, particularly following the stampede incident outside the M Chinnaswamy Stadium in Bengaluru during the victory celebrations shortly after the team secured the title in June.

RCB is one of the most beloved franchises in the IPL, largely due to its star player, Indian cricket legend Virat Kohli, along with international icons like Chris Gayle, AB de Villiers, Glenn Maxwell, and Faf Du Plessis, who have represented the team over the years.

When the IPL was inaugurated in 2008, RCB was the second-most expensive franchise, purchased by Vijay Mallya, then-chairman of United Spirits, for 111.6 million US dollars in 2007. Mallya stepped down as director of RCSPL in 2016, leading to Diageo acquiring full ownership of the company.

The sports news outlet has also reached out to RCB's vice-president, Rajesh Menon, for further comments.

Despite these developments, it is unlikely that there will be significant changes to the team's plans for the upcoming seasons in both the IPL and WPL. Should a new owner emerge, they would need to obtain clearance from the IPL, a process that could extend beyond the next season. The WPL is expected to commence in January, while the IPL is scheduled to run from March through May.