Rugby-Union vote paves way for private equity investment in New Zealand rugby
June 2 (Reuters) – A special New Zealand Rugby general meeting in Auckland on Thursday voted in favor of a NZ$200 million ($129.42 million) private equity investment from US firm Silver Lake, the final step in the process. approval of the revolutionary agreement.
The deal, approved in a majority vote by the country’s provincial unions, values New Zealand Rugby’s (NZR) business assets at NZ$3.5 billion and will see Silver Lake take 5.71 per cent to 8.58% of a new entity, NZR CommercialCo.
NZR, whose finances have been rocked by the COVID-19 pandemic, believe they need an infusion of cash to keep pace with northern hemisphere rugby powerhouses and reinvigorate the game’s fundamentals.
“This is a transformative moment for rugby in (New Zealand) at all levels of the game and it will allow us to move forward, change and take advantage of the huge opportunities that lie ahead of us,” said the NZR Chairman Stewart Mitchell in a statement. .
The deal has been controversial, however, with some New Zealanders wary of the idea of any level of foreign ownership of the famed All Blacks brand.
Silver Lake, which has more than $88 billion in assets, is one of the largest technology investors in the world.
Past investments in the sports market include stakes in City Football Group, the Ultimate Fighting Championship (UFC) and Madison Square Garden Sports, which owns the NBA’s New York Knicks and the NHL’s New York Rangers.
The deal, which lasted two years, gives Silver Lake a smaller stake compared to the NZ$387.5 million offered for 12.5% last April.
That deal was rejected by the players’ union (NZRPA), which approved the new offer in February after being promised a seat on the new entity’s board.
The 26 provincial unions will receive an immediate financial windfall of up to NZ$1 million each as part of the deal.
An additional investment ranging from NZ$62.5 million to NZ$100 million will be offered to New Zealand-based institutional investors later this year.
Silver Lake, NZR and the NZRPA will also form an entity called “Global Rugby Opportunities” to invest in global rugby and rugby-related technology businesses outside of New Zealand.
($1 = 1.5420 New Zealand dollars)
($1 = 1.5454 New Zealand dollars)
(Reporting by Nick Mulvenney in Sydney, editing by Peter Rutherford)
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