New Zealand Rugby’s provincial unions unanimously agreed to a deal with California-based Silver Lake Partners at its annual general meeting in Wellington, selling a stake in the All Blacks to US investors.
Chief executive Mark Robinson called it a one-off chance to reset the cash-strapped body’s finances. "We believe it is an exciting and truly transformational opportunity that can benefit the entire game for generations to come,” he said.
The decision ignored the opposition from top players who fear the deal will sully rugby’s most storied team. The proposed deal faces a potential veto from the Rugby Players Association.
NZR chairman Brent Impey described the deal as “compelling” and said it represented “a revolutionary turning point for rugby”.
“[It’s] a unique opportunity for New Zealand Rugby to drive commercial revenues to… enable investment into the areas of most need,” he said.
Concerns around the deal have intensified in the wake of the European Super League fiasco, when Europe’s top football clubs shelved a US-backed breakaway competition after an outcry from fans and officials.
Under the deal, Silver Lake will pay $NZ387.5-million (just more than R4-Billion) for a 12.5 percent stake in New Zealand Rugby’s commercial rights, and the right to negotiate merchandise and broadcast deals worldwide.
The focus for the Americans is the All Blacks, the three-time world champions recognised globally as rugby’s most potent brand.
Robinson said the coronavirus pandemic hit NZR’s already strained finances so hard that at one point the governing body’s survival was at stake.
He told delegates from provincial unions “the future of the game is in your hands”.
▲ Impey was disappointed at the opposition from the players’ association, but said the vote showed the wider rugby community supported it.
He said that it would be a “terrible mistake” if the players’ association scuttled the deal.
Impey said the money would be used to help struggling provincial unions, develop the women’s game and increase youth participation.
He also said technology investments facilitated by the deal would give NZR the ability “to access millions of fans around the world”.
▲ The state of NZR’s finances was underlined when results released at the annual meeting showed losses of more than US$25 million in 2020.
Former NZR chief executive David Moffett has warned that Silver Lake, which boasts assets under management of US$79 billion, will squeeze all it can from the All Blacks brand – including the All Blacks playing “meaningless” exhibition matches in the United States to generate income from large crowds without providing a genuine sporting contest.
The players association has said it is concerned about appropriation of Maori and Pasifika culture, including the haka, and suggested alternative fund-raising methods to support the game.
In contrast with the fury vented by football fans recently, Kiwi rugby supporters have been largely silent about the private equity proposal, seemingly content to let the players’ union spearhead opposition.
Silver Lake did not respond to a request for comment on the NZR deal.
Adapted from AFP news release