US equity firm takes stake in New Zealand's All Blacks / Photo: JUAN MABROMATA - AFP/File
US equity firm takes stake in New Zealand's All Blacks
US private equity firm Silver Lake secured a NZ$200 million (US$134 million) stake in the famed All Blacks Thursday, after New Zealand Rugby overwhelmingly endorsed a contentious deal after years of wrangling.
The 89-to-one vote ended a heated two-year negotiation that pitted rugby bosses against the players' association and provincial unions, amid concern about selling off part of the country's culture.
Rugby is more than just a game in New Zealand and is seen as an integral part of the social fabric.
The men's national team, the All Blacks are regarded as national heroes.
The side has a winning Test record of more than 77 percent and having won three of the nine Rugby World Cups, is one of the most successful teams in world sport.
It was a "monumental moment in the history of rugby in New Zealand," NZR chairman Stewart Mitchell said announcing the deal.
"It has taken us some time to reach this point and that is because our members care so deeply about our game, our communities, and our people."
Right up until the vote, closed-door meetings were going on as New Zealand's 26 provincial unions sought assurances they would not be sidelined and there would be benefits for the game at the grassroots level.
The cultural sensitivity was a point acknowledged by Silver Lake managing director Stephen Evans as he outlined plans for the commercial arrangement with NZR.
"Digital technologies are changing sports and media, providing a lot of opportunities for rugby, and we are ready to help go after them while respecting the values and traditions of the game in New Zealand," he said.
The deal sees Silver Lake, a fund manager specialising in private equity investments and whose growing stable of sports interests already includes Manchester City, pay NZ$200 million for a 5.8 percent stake in a new commercial entity operated by NZR.
An additional investment of NZ$100 million will later be offered to New Zealand-based institutional investors and Silver Lake's holding could rise to 8.58 percent depending on the share uptake.
- The 'way forward' -
Critics say the All Blacks have not capitalised on their marketability in a way other leading brands in sports such as Formula One and European and English football have done.
Silver Lake are expected to provide expertise in areas such as broadcast, sponsorship, and digital technology innovations.
New Zealand Rugby was hit hard by the coronavirus pandemic, losing NZ$40 million in 2020 and its provinces have been losing money for several years as spectator and player numbers fall.
But, NZR chief executive Mark Robinson believes if money floods in under the Silver Lake deal it could enable a new pay structure with the players and provinces.
The Rugby Players Association chief executive Rob Nichol described the lengthy negotiations as "a thorough and robust process" with "the potential to be a very successful partnership and way forward for rugby in New Zealand."
A.Davidson--MC-UK
