Live Current Media, who earlier shot into media limelight in India because of a $50 million contract with the BCCI has sold Cricket.com to GCV Mauritius for $1.75 million. The move is seen as an exit to a high cost center with its Cricket related operations on the web.
On August 25, 2009, Live Current executed agreements to divest all of the Company’s cricket operations, including the cricket.com domain name and website and the rights granted under the contract with the Indian Premier League. In return, Live Current will receive consideration of $1.75 million plus related expenses as follows:
- $1 million in cash to be paid quarterly in equal installments with the first payment of $250,000 to be paid within two days of closing;
- The assumption by GCV Mauritius of a liability totaling $750,000 related to past obligations to the BCCI;
- The assumption by GCV Mauritius of salary and employment expenses related to the Live Current employees associated with cricket.com. These expenses include salary obligations for Live Current’s President, Mark Melville, the payment of up to $60,000 in severance costs resulting from the termination of other cricket.com related employees, and a monthly payment of $2,500 for general overhead expenses. These expenses will be paid for a period of up to 6 months.
As a result of this transaction, Live Current and its subsidiaries will have no outstanding liabilities relating to the company’s historical cricket activities.
Live Current was always running against the tide on a lot of ends with its Cricket based efforts. Besides Cricket.com it also owns (perhaps ‘owned’ now) other domains such as T20.com, iplt20.com, etc. besides their 800 strong domain name portfolio. With Cricket.com their initial idea was to build a community site and then let loose the North American model of e-commerce based on memorabilia and autographed items. For factors that go beyond the game watching habits of Cricket enthusiasts, like not knowing the sport well enough perhaps did LCM in with the sport related portals.
Add to this the huge $5 million payment burden to BCCI following their huge deal with them didn’t help the company anyway. More than a strategic investment the move seemed a gamble on tapping into markets their competitors might not have looked at. The fact that they had rejected a $6 million offer for the domain might pique them quite a lot following these recent developments.
The sudden move is a step to restructuring their cash flow besides focussing on portals that they’re perhaps more suited to manage. LCM recently launched Karate.com and the cash generated would support the growth of such domains. The company also sold a few non core domains for another $1.6 million to add to their cash reserves.
The company owns about 30 other premium names, including boxing.com, karate.com, brazil.com, indonesia.com, greatbritain.com, malaysia.com, vietnam.com, body.com, number.com, leisure.com, call.com, electronic.com and one of the largest e-commerce sites, called perfume.com. Reports mention that the sale of Cricket.com also takes any obligation related to Cricket related activities of LCM, however I am not whether other Cricket related domain names are also part of this deal for sure.
A question I don’t have an answer to right not is about GCV Mauritius. The contract with BCCI and Live Current was on the name of Global Cricket Ventures (GCV) which was reported to be a join venture with of Live Current and Netbluelinks Holdings. What is the current status of GCV and whether LCM has any stake in it in some way is something I don’t have much idea about.
