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Provincial unions give green light for
NZ$387.5m deal
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Proposal still needs consent of players’ union
to go ahead
New Zealand Rugby has moved a step closer to selling a stake in
the game after the nation’s provincial unions voted unanimously to give the
green light to a huge deal with a US investment firm.
The 26 unions and the Māori Rugby Board voted to sell a 12.5% stake
to the private equity firm Silver Lake that would bring a cash injection of
$NZ387m to NZR, which posted a NZ$18.7m operating loss at its AGM on Thursday.
It brings into sharp focus the prospect of the All Blacks
becoming a non-wholly publicly owned entity for the first time in the team’s
115-year history.
The deal, which values
NZR’s commercial rights at $2.23bn, is yet to be ratified and needs the
approval of the players’ union for it to go ahead.
NZR said it would
continue discussions over the coming weeks with the New Zealand Rugby Players’
Association, which is holding out on the deal over a range of issues.
Several high-profile players, including All Blacks captain Sam
Cane, have raised fears about the commercialisation of sacred team symbols –
including the haka – and increased demand to play exhibition games for money
and brand exposure.
NZR chair Brent Impey said the “game has to change” and that the
support of the players was crucial.
“The players are a critical part of this journey, but we have to
look at what is right across all levels of the game, our whole ecosystem,”
Impey said. “We hope the NZRPA will realise the significance of the opportunity
in front of us and will continue to work toward an agreement in coming weeks.”
Should the deal be rubber stamped, a large portion of the money
would be funnelled into grassroots rugby, which has suffered from falling
participation numbers at the community level.
The drop in participation has been in part due to the Covid-19
pandemic, which has also affected NZR’s bottom line. The operating loss blew
out from the $5m budgeted pre-Covid to NZ$34.6m, which included a NZ$16m
writedown of Sky Television shares created.
“New Zealand Rugby needs investment,” Auckland University of
Technology senior lecturer Richard Wright told Radio NZ. “Why? Because other
people are not investing as much in rugby as much as they used to do, and that
includes New Zealanders.”
Silver Lake has a portfolio of stakes in sporting clubs around
the world; the UFC, the Premier League’s Manchester City, A-League’s Melbourne
City and the NBA’s New York Knicks included.
“They’re investment bankers. They would have done their due
diligence. They’re not mugs,” Wright said. “The All Blacks played six times
last year. The most they might play this year is 15 times. To get that return
on investment, they’re going to want to see the All Blacks playing and the ABs
brand as much as possible.”
The prime minister, Jacinda Arden, would not say whether she
supported the deal, saying it was NZR’s decision.
“The offer that has been made there with the negotiation that is
under way, it is not something that directly involves the New Zealand
government,” she said.
Sports minister Grant Robertson said: “I just encourage both
parties to continue talking because for the good of the game we need our elite
players to be well looked after, happy to be playing here, and carrying on
supporting the next generation coming though.”
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