Will NZ Rugby sell stake to Silver Lake? Big decision looms

New Zealand Rugby will ask for approval for the Silver Lake deal on Thursday. Photo: RNZ
New Zealand Rugby will ask for approval for the Silver Lake deal on Thursday. Photo: RNZ
Tomorrow is the first hurdle in New Zealand Rugby getting its $387 million deal with American private equity firm Silver Lake across the line.

At its AGM, New Zealand Rugby (NZR) will ask for approval for a deal giving Silver Lake a 12.5 percent stake in NZR's commercial rights.

But there is still plenty to do before the deal is successful - the players association is yet to grant its approval. Meanwhile, the country's smaller provincial unions are onside.

South Canterbury Rugby Unions chief executive Craig Calder told Checkpoint "We just see it as a lifeline for the future of provincial rugby and it will help us secure our future and help us fund our clubs and fund our grassroots rugby and really grow the game further as we go through the changes of rugby".

NZR had dangled a carrot in front of the country's smaller grassroots unions, promising funding for things like debt repayments or building and improving assets, Calder said.

Long term the provincial unions had also been promised access to a legacy fund, he said.

"All clubs and all associations can apply for funding from that for various projects which can only help grassroots rugby."

Some provincial unions around the country have reported plummeting participation levels in what is supposed to be New Zealand's favourite game.

West Coast Rugby Union chief executive Mike Connors said times were tough in his patch, so the union was pinning its hopes on the Silver Lake deal improving its fortunes.

"Small provinces like us have taken a bit of a battering over the years with economic decisions concerning most of our assets and also with Covid last year. It's had a massive effect."

Union bosses spoken to by Checkpoint were coy when it came to what specifically they stood to gain from a financial standpoint.

Connors said for unions like his the deal was about their long-term survival.

"The provincial unions need it to keep the game going in the small communities of New Zealand, that's coming from a heartland perspective and any support we can get we'll gratefully receive."

What NZR has to say
NZR chairperson Brent Impey told Checkpoint no agreement had been reached with the players association yet, but he was hopeful of receiving support from the provincial unions on Thursday.

The players association and NZR were at "different ends of the spectrum", he said.

"New Zealand Rugby needs to do this transaction. It is transformational for the whole game, not just for the professional players. There are 158,000 community players, amateurs, etcetera and what we need to do is create a legacy for all of rugby to be able to move forward."

NZR's concern with the players association proposal was that it failed to achieve the primary object of "transformational change for all of rugby".

There was an issue around how much money from the deal went into the game's legacy fund and how much went to the players association, he said.

"My word is that I think they are failing to realise what is a significant opportunity and it's disappointing. They won't get paid less. They'll end up getting paid more. It would be a smaller percentage but it will be more money.

"The percentage is a calculation as a result of everything that goes in it. It's never been a fixed percentage since 1995. It's changed every time there has been a collective agreement negotiated."

The NZR's argument was that "yes money has to go to the professional game and yes we want to pay our professional players more, but more importantly, all the mums and dads out there, the need for clubs, schools, teenagers, Māori, Pasifika, women, whatever it is we fail to have sufficient resources to be able to solve the problems we have".

Saying no to the "no-brainer" deal would be "the biggest own goal in the history of New Zealand sport", he said.

In the deal, NZR would retain "all controls over anything related to the game", Impey said.

"What this is about is the sale of commercial rights ... what we are selling is broadcasting, ticketing, sponsorship, merchandise, licensing etcetera."

He could not guarantee that fans would not pay more for tickets.

New Zealand Rugby Players Association boss Rob Nichol would not comment when approached by Checkpoint, but did say mediation with NZR had been put on hold so the parties could reconnect with their stakeholders.

 

 

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