US equity firm takes stake in New Zealand's All BlacksWorld News 

US equity firm takes stake in New Zealand’s All Blacks

US private equity firm silver lake got a NZ$200 million (R2 billion) Rugby in New Zealand and its famous full black Provincial unions overwhelmingly approved the deal on Thursday after years of wrangling.

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The 89-1 vote ended two years of bitter negotiations that saw rugby bosses negotiate bitterly with the players’ association and provincial rugby union over fears of selling parts of the country’s culture to foreign owners.

Rugby is not just a sport in New Zealand, it is seen as an integral part of the social fabric.

Considered a national hero, the All Blacks have won three of the nine Rugby World Cups and are one of the most successful teams in world sport.

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NZR chairman Stewart Mitchell praised “A momentous moment in New Zealand rugby history”.

“It took us a while to get to this point and that’s because our members care so much about our game, our community and our people,” he said Thursday.

New Zealand’s 26 provincial unions were meeting behind closed doors until the vote, seeking assurances they would not be sidelined and would benefit in the race at the grassroots level.

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In the deal, Silver Lake, a fund manager specializing in private equity investing, paid NZ$200 million for a 5.8 per cent stake in a new business entity run by NZR with increasingly stable sports interests, including Manchester City.

An additional investment of NZ$100 million will be made available to institutional investors in New Zealand at a later date, and Silver Lake’s stake could rise to 8.58 per cent, depending on share absorption.

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Silver Lake is expected to provide expertise in areas such as broadcasting, sponsorships and digital technology innovation.

“Digital technology is transforming sport and media, providing rugby with many opportunities and we are ready to help them achieve their goals while respecting New Zealand football’s values ​​and traditions,” he said. said Stephen Evans, managing director of Silver Lake.

Critics say the All Blacks have not used their marketing prowess like other leading brands in sports such as Formula 1, European and British football.

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Rugby in New Zealand has been hit hard by the coronavirus pandemic, losing NZ$40 million in 2020, and its provinces have been losing money for years as spectator and player numbers have fallen.

NZR chief executive Mark Robinson believes if there is an influx of money under the Silver Lake deal, it could set up a new pay structure with players and provinces.

Rugby Players Association chief executive Rob Nichol described the lengthy negotiations as “A thorough and robust process” and “Having the potential to be a very successful partnership and way forward for New Zealand Rugby”.

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Robinson said this would allow NZR to bring All Blacks to a wider audience, but he warned “It’s by no means a panacea.

“We know there’s a lot of hard work to be done, and we know the Silver Lake team shares the same view.”

Sports have become an attractive proposition for institutional investors in recent years, especially in the US and Europe, and football has not been immune.

Private equity firm CVC last year bought a 14.3% stake in the Group of Six for £365m.

Rugby New Zealand’s Mitchell also warned that the deal was not immediate.

“We have to sit down now, work with the new board, make sure we have these business plans in place, make sure we execute those business plans with our partners, and get the payoff that we can expect to see in the next five years,” He says.

By Garrin Lambley © AFP

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