Silver Lake buying a stake in the ABs?
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Here is the full article on Stuff.
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The furore over the breakaway six in UK football is a window into the issues.
For big money the objective is to recruit international fans. The problem is that they want to watch the big ten countries play each other and aren’t so interested in Super rugby etc. And playing in Europe more practical than on other side of world.
The original fan base is easily disenfranchised.
Rather we throw our lot in with Japan.
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Former NZ Rugby boss fears ultimate cost of Silver Lake deal
Meaningless exhibition games for the All Blacks and a greater stake in New Zealand Rugby will be the ultimate outcome of the proposed $460 million deal with US tech giant Silver Lake fears a former head of New Zealand Rugby. Next week's New Zealand Rugby AGM will vote on whether to proceed with the proposed $460 million deal which would give Silver Lake a 15 percent stake in the game. But David Moffett, who was chief executive of New Zealand Rugby between 1996 and 2000, struggles to see where the value for Silver Lake is. "Silver Lake are not benefactors. They are not going to pump a whole lot of money into New Zealand Rugby without expecting a return (so) I am struggling to see how they can increase the revenue return to NZR and ultimately themselves that New Zealand Rugby haven't been able to do on their own," Moffett said. "After all, they (NZR) are the biggest rugby brand in the world. They are right up there with Manchester United and some of those other great sporting brands. "There wouldn't be a door that (CEO Mark Robinson) couldn't open to talk about raising money... so what happens if this doesn't work out?" The backlash from football fans in the Britain and Europe over the now suspended European Super League should also be a warning sign, Moffett said. "Clubs have sold their souls and then had to do complete backflip." But Moffett accepted the NZR was caught between a rock and a hard place in trying to secure its financial future "just like every rugby union in the world". "Even prior to Covid things were looking pretty difficult especially with the implosion of Super Rugby which was going to happen irrespective of Covid because they couldn't make up their mind just what sort of format it was going to take and people were turning off in droves and I hope for New Zealand Rugby's sake they have chose the right path to go down." If the deal did not lead to more flowing into grassroots rugby "it could have the opposite effect and that would be terrible", Moffett said. Under the proposal, Silver Lake will essentially get a 15 percent stake in the new commercial rights company that would be established, but Moffett felt Silver Lakes influence would translate to more than that. "If (Silver Lake) don't get the return they expect, they may very well say we want a bigger percentage and a bigger say. "Because if they don't get the return that has been worked out, because spread sheets are one thing but delivery is another, then they will be looking at ways at which they can and... the first place they will look at is how many times can we get the All Blacks to play and where they can get them to play. "Will it be exhibition matches in the United States for example? But whether it's now or in the future you will see the All Blacks playing more games and perhaps more meaningless games and that just devalues the greatest brand in rugby." -
@stargazer good god there is name I was happy to forget.
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@kirwan said in Silver Lake buying a stake in the ABs?:
@stargazer good god there is name I was happy to forget.
He does occasionally make sense post his involvement in actually running the game.
Was more than happy to see the back of him. He was no Chris Moller or Steve Tew.
On the other hand he was no David Rutherford.
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@kirwan said in Silver Lake buying a stake in the ABs?:
I'm starting to appreciate Tew more and more. We had bad management before him and it seems after him these days.
Appallingly bad decisions. Directly approaching Australian super franchises still makes me shake my head
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@kirwan said in Silver Lake buying a stake in the ABs?:
I'm starting to appreciate Tew more and more. We had bad management before him and it seems after him these days.
I thought Moller was good, and the pair of them made a good team.
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@stargazer said in Silver Lake buying a stake in the ABs?:
"Because if they don't get the return that has been worked out, because spread sheets are one thing but delivery is another, then they will be looking at ways at which they can and... the first place they will look at is how many times can we get the All Blacks to play and where they can get them to play.
Not sure if Moffat is entirely correct here.
The amount of money talked about is large to us (and in rugby terms) but is chickenfeed compared to other sports entities and commercial investments worldwide to a company like Silverlake.
My guess is that the proposal is a strategic long term one more than being based on an expected annual return.
Places them with a finger in the pie of another global brand to add to their portfolio.Now let's say that post COVID Amazon decides to shake up the sports broadcasting rights sector. They are simply waiting for the equivalents of SparkSport around the world to do the normalising for them IMO. Silverlake is making strategic investments in various places to hold some power in those changes and reap the rewards.
Whether that benefits NZ Rugby I don't know. We may get swept along in something with less say than we would like.
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I think Moffitt is on the money with his approach. Surely NZRU can open the doors of opportunity themselves without selling out their control for someone else to. Ultimately the players collective will determine where things move and NZRU must work closely with them as their primary partner I believe or the compromises will become intolerable.
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@arhs said in Silver Lake buying a stake in the ABs?:
I think Moffitt is on the money with his approach. Surely NZRU can open the doors of opportunity themselves without selling out their control for someone else to.
Maybe NZR have tried to do exactly that but haven't found any interested parties that were prepared to pay $400M+. So this is the best offer available, despite the risks.
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I thought this was more about the intellectual/marketing aspect as opposed to assets?
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Clause B states NZR to transfer all commercial assets to Commercial LP.
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Clause C states NZR sells a 12.5% stake in Commercial LP to Silver Lake.
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New Zealand Rugby's proposed deal with Silver Lake won't get the green light at Thursday's Annual General Meeting in Wellington. Newshub understands negotiations between NZR and the Players Association are at an impasse and the proposed $387.5 million deal won't get the sign off it needs at the AGM. NZR has rejected two last ditch alternatives to the proposed Silver Lake deal from the Players Association. The governing body and the Players Association have been at loggerheads over the proposed deal for US firm Silver Lake to acquire a 12.5 percent stake in NZR worth $387.5m. Newshub understands two alternatives were put to NZR in their latest round of mediation talks, which concluded on Tuesday. One of those was debt raising - where NZR would essentially take out a loan they'd then pay back with interest - and the other, selling a five percent commercial stake in the company to a private investor. But those would only raise around $90m and $150m respectively, significantly less than what's been tabled by Silver Lake, Newshub understands. NZR has rejected both alternatives, both on the basis that they wouldn't be able raise enough capital and wouldn't benefit the game at grassroots level, which is at the core of NZR's deal with Silver Lake. Mediation will continue with the Players Association following Thursday's AGM, as both parties search for common ground in this much maligned deal. -
@bovidae said in Silver Lake buying a stake in the ABs?:
Newshub understands two alternatives were put to NZR in their latest round of mediation talks, which concluded on Tuesday. One of those was debt raising - where NZR would essentially take out a loan they'd then pay back with interest - and the other, selling a five percent commercial stake in the company to a private investor. But those would only raise around $90m and $150m respectively, significantly less than what's been tabled by Silver Lake, Newshub understands. NZR has rejected both alternatives, both on the basis that they wouldn't be able raise enough capital and wouldn't benefit the game at grassroots level, which is at the core of NZR's deal with Silver Lake.Why are they going straight from, $90m in reserves, maybe close to eaten up by now after covid, straight to selling equity?
Why not raise the $90m loan?
Then see if in few years, then need to sell equity?
NZRU have never been in debt , for 25 years , we are now just getting close to no reserves and we panic?
This feels rushed, reactive, and I simply dont trust the acumen of these current numpties on the board.
I'm hoping the players hold out.
Make the provincial unions cut their cloth to fit.
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@rapido I think it's about more than cash reserves. They want to put money into the grassroots and unions - they want to try and 'future proof' the game in NZ.
For quite a few years now they've been either just keeping their head above water or posting operating losses. It's not a sustainable model currently.
