Rugby: New frontier for sports investment firms
RUGBY’S crown jewels are in the sights of investors seeking to exploit the untapped potential of the market as struggling governing bodies try to replenish their coffers.
US private equity firm Silver Lake is reported to be offering around $340 million for a 15 per cent share of commercial rights in the All Blacks – the ultimate brand in the sport.
In the northern hemisphere, CVC Capital Partners – which formerly owned a controlling stake in Formula One – is widely expected to acquire 14.5 per cent of the commercial rights for the Six Nations for $514 million.
Phelan Hill, a senior consultant at Nielsen Sports, said the corporate battle for premium rugby rights was “already alive”.
“With rumours of CVC concluding a deal for the Six Nations shortly, the involvement of another big investor may help the goal of expanding the global market for the game, but due to the pull of the All Blacks it won’t be just CVC calling the shots.”
Hill said if the All Blacks deal went through, it could change the dynamics of southern hemisphere rugby.
Silver Lake already has a 10 per cent stake in the City Football Group, owners of Premier League giants Manchester City.
“Super Rugby’s [the southern hemisphere club competition’s] financial model is under huge pressure – both the competition and its individual teams – due to Covid-19 and they need to plug the revenue gap.
“New Zealand are taking things into their own hands now and looking for alternatives outside of the governing body for support, which could ultimately drive conflict between New Zealand and SANZAAR objectives.”
Hill also believes rugby could be a tantalising option for US investors.
He said English Premiership clubs could be an attractive low-cost choice compared with US sports outfits, which are “reaching a tipping point in terms of price, with the average franchise value in the NFL exceeding $3 billion”.
US investors have already piled into English football with high-profile investments in Premier League clubs Liverpool, Manchester United, Leeds United and Fulham.
James Paul, portfolio manager at Blackstar Capital, said if American investors switched their attention to rugby, the nature of the involvement would be different from the football model.
“In rugby, I believe the question is about growing the sport itself to both a wider local and more global audience rather than focusing almost exclusively on individual clubs or brands.”
Paul said rugby could even have an advantage over football in terms of its long-term potential, with more room to expand.
“It makes sense that a company like CVC are getting involved, because these are assets with a lower entry cost and the potential for a significant growth-fuelled return in the future.”
Paraag Marathe, president of 49ers Enterprises, recently became vice-chairman of Leeds United as NFL franchise San Francisco 49ers increased its stake in the English football club.
He agrees with Hill that English Premiership rugby could catch the eye of US investors as a feelgood factor returns with the easing of the coronavirus crisis.
“When we come out of Covid I believe very strongly the excitement and enthusiasm for pro sports is probably going to surpass pre-Covid levels.
“It will be like the Spanish flu pandemic in 1918 which was followed by the Roaring Twenties.”
TIGER Woods suffered serious injuries to both legs as his car flew off the road and flipped several times on February 23 near Los Angeles in a crash he was “very fortunate” to survive, law enforcement officials who found the US golf legend said.
Woods did not appear to be under the influence of drugs or alcohol during the early-morning incident, and underwent surgery after the roll-over collision, said Los Angeles County Sheriff Alex Villanueva.
No other vehicles or passengers were involved in the crash which occurred on a steep stretch of road known as a “hotspot” for high-speed accidents in recent years.
“I will say that it’s very fortunate that Mr. Woods was able to come out of this alive,” said deputy Carlos Gonzalez, the first officer to arrive on scene.
Gonzalez found Woods trapped in his vehicle but conscious, appearing “calm and lucid” and able to identify himself.
“It is my understanding that he had serious injuries to both legs,” said Los Angeles County fire chief Daryl Osby, describing Woods’ condition as “stable”.
Firefighters and paramedics extricated Woods from the wreckage of his SUV and transported him with a neck collar and backboard to a local hospital via road, where he underwent surgery.
There was “no evidence of impairment at this time” including any influence of narcotics, mediciation or alcohol, said Villanueva, adding that the crash remained “subject to investigation”.
He added that no blood was drawn at the scene of the crash because the sheriff’s office does not have that capability.
Woods, one of the most successful golfers of all time, has won 15 major golf championships.
He recently underwent his fifth back surgery, and said he was uncertain if he will be able to play at the upcoming Masters, which he last won in 2019.
Woods, 45, was in the area for his annual Genesis Invitational golf tournament at the Riviera Country Club, and was driving a courtesy car on the morning of the crash.
“We are awaiting further information when he comes out of surgery. On behalf of the PGA Tour and our players, Tiger is in our prayers and will have our full support as he recovers,” PGA Tour commissioner Jay Monahan said in a statement.
‘True champion’
The crash occurred near the hilly Palos Verdes peninsula, at the bottom of a steep stretch of road which has runaway truck ramps for vehicles that lose control going downhill, and which has become notorious for fatal accidents over the years.
“Apparently, the first contact was with the center median, and from there, [the car] crossed into the opposing lane of traffic, hit the curb, hit a tree, and there were several rollovers during that process,” said Villanueva, who did not provide a cause of the crash.
The car ended up on its side on a patch of grass some distance off the road, with its hood badly damaged.
News of the crash spread rapidly around the sport world and beyond, with figures inside and outside golfing swift to send their prayers and best wishes to Woods.
Skier Lindsey Vonn, Woods’ former girlfriend, tweeted: “Praying for TW right now.”
“I have no doubt about it, he’s gonna be back,” former US president Donald Trump told Fox, urging Woods to “get better and get out there because we all miss him.”
‘Deeply concerned’
Woods was one of the most revered athletes in the world when he became engulfed in scandal in late 2009.
He smashed his car into a tree and a fire hydrant outside his luxury Florida home, sparking a series of scandalous revelations that doomed his marriage and put his game in freefall.
He later divorced from his Swedish wife Elin Nordegren, with whom he has two children, after a cascade of women came forward to say they had affairs with the golfer, making him fodder for tabloids around the world.
Woods then underwent four back surgeries between 2014 and 2017.
In May 2017, he was arrested near his Florida home for being asleep at the wheel of his car in a traffic lane.
Woods said he had taken a mixture of prescription drugs and did not realise they would cause him to fall asleep. He pleaded guilty to reckless driving.
But he made an astonishing comeback to sensationally win the Masters in 2019, his first major title since the 2008 US Open.
He is the winner of 82 USPGA titles, level with Sam Snead for the all-time record.
In 2000-2001, while aged just 25, Woods became the first man to hold the US Open, British Open, the USPGA and the Masters titles at the same time.
Woods remains three major victories shy of the all-time record 18 won by Jack Nicklaus, but only four winners in majors history have taken a title at an older age than Woods is now.
“Barbara and I just heard about Tiger’s accident, and like everyone else, we are deeply concerned,” tweeted Nicklaus.
“We want to offer him our heartfelt support and prayers at this difficult time. Please join us in wishing Tiger a successful surgery and all the best for a full recovery.”