Commonwealth Games official complains: Firm managing sponsorships is getting the cuts, not the deals

The top revenue official of the Commonwealth Games Organising Committee (OC) has prepared a note saying that a foreign company contracted to bring in sponsors for the Games has achieved “practically nil” results.

With less than six months to go for the Games, the OC has only six sponsors, with just over a quarter of the Rs 1,200 crore sponsorship target met.

Four of these sponsors, making up the bulk of the total sponsorship value so far, are public sector organisations. However, the company managing the sponsorships, the Singapore-registered Sports Marketing and Management (SMAM) gets a commission of between 15% and 22.5% on all sponsorship deals, including those struck with Indian public sector undertakings.

“SMAM’s contribution in major deals signed so far has been practically nil, even though they are entitled to the same commission from these deals as they are from deals which are negotiated by them,” wrote V K Saksena, Additional Director-General, Revenue, in a note prepared on February 12.

Saksena is an IAS officer on deputation with the OC. The note, a copy of which is with The Indian Express, was written after Saksena discussed the matter with OC Treasurer Anil Khanna. Khanna, who heads the R K Khanna Tennis Academy, joined the OC after the previous treasurer, A K Mattoo, quit in the wake of the crisis in Indian hockey in January.

Saksena sent the note to SMAM on February 20, asking for a review of their performance. March 17 was fixed as the date for the review, but the meeting was cancelled. SMAM has earlier managed sponsorships for the Melbourne (2006) and Manchester (2002) Commonwealth Games, and works for the British Olympic Association.

Hero Honda and Coca-Cola are the two private sponsors who have come on board so far with commitments of Rs 38 crore and Rs 15.7 crore respectively. PSUs NTPC, Air India and Central Bank have committed Rs 50 crore, Rs 50 crore and Rs 51 crore respectively.

SMAM will get a commission for all these deals. The only sponsorship it will not get a commission for is by the Indian Railways, which, at Rs 100 crore, is the lead partner for the Games, and whose sponsorship was part of the Budget announcement.

OC chief Suresh Kalmadi said, “When you are tying up with a PSU, our effort is about one-third. They will not give us a sponsorship based merely on our clout until SMAM gives them a detailed presentation and then follows it up.”

The agreement between SMAM and the OC was signed on July 25, 2007, making the company the “sole and exclusive negotiator and procurer of sponsonsorship for licensing contracts”.

In his note, Saksena said, “SMAM claims to have brought 150 companies so far, but hardly any of these have joined the OC as sponsor.” SMAM was unable to find any sponsors for the international leg of the Queen’s Baton Relay.

Despite repeated attempts, no official from SMAM could not be contacted. The company’s India representative Susan Hunt was not available, and calls to Mike Bushell, who heads the firm, at its office in New South Wales, went unanswered.

Kalmadi said that he was “satisfied” with SMAM, and sponsors would come “very soon”.

“We will be getting more sponsors on board very soon. It has been seen worldwide that in the last six months in the run-up to the event, sponsors start pouring in. We are satisfied with the working of SMAM and will achieve the sponsorship targets,” Kalmadi told The Indian Express.

The OC is currently negotiating with Maruti Suzuki, Samsung, Tata, Arcelor Mittal and several other firms.