The Pro 14 will not exist in five years’ time
CVC may do to rugby what it has done to Formula One – take it over
ADECK OF cards is always a good medium for an analogy. There are a goodly amount of relationships struggling under the lockdown. Most relationships are like a deck of cards – you start with a heart, move on to a diamond, eventually a club and ultimately a spade.
This one is about the house of cards coming down around us.
Last week we were informed that CVC Capital Partners had taken a 28 per cent share of PRO14 Rugby from Celtic Rugby DAC. CEO of PRO14 Martin Anayi said: “CVC’s show of faith has been impressive and is in keeping with their proven track record on success when it comes to sport investment including Formula One, Moto GP and Premiership Rugby. This partnership allows all of our stakeholders to plan for a sustainable period of growth which will benefit the fans, the players and the game.” That was the official press release.
I’d like to issue my own press release in reply to that statement: “My A**e.”
If you go online there are over 100 articles on the CVC investment in PRO14. You would imagine in these times that there would be time for contemplative thought in relation to an announcement of this magnitude. Surely curiosity would have got the better of some people? No! The press release repeated verbatim – word for word – unquestioned.
This, we are told, is great news – we have got £116 million (€129m) for 28 per cent of the company. Fantastic news and, boy, has it come at the right time. The fairy godmother has come in, flicked her wand and, hey ho, £116m of free money in the kitty.
Because Martin Anayi or anyone else in his organisation won’t take any calls or go on the record with any details of the financial aspect of the deal nobody has a clue what it entails or what the financial implications are. All we know is what they tell us in the press release. You’d wonder whether they know what is coming down the line.
The first question we have to ask is why on earth would a hedge fund take a stake in the PRO14?
The league has serious issues which I think are intractable. Two of the teams in the league are drastically uncompetitive. Benetton and Zebre have improved marginally over the season but you couldn’t ever take them seriously nor do they have a chance of winning the competition.
The two Scottish sides are a mixed bag and while Glasgow were competitive for a few seasons they’ve fallen off the pace, lost some of their quality and it seems that neither can get a workable formula across the spectrum.
The Welsh clubs are a disgrace in the PRO14 and Champions Cup. The accusation that they have never taken either competition seriously still holds water. If one or other of them is in contention coming into the play-offs they may rouse themselves but you would wonder why they bother. The introduction of two Vanarama league South African sides has brought nothing to the competition.
Every team that travels the 13 hours down to Bloemfontein and the east Cape do so with weakened sides and the financial controller’s trepidation as the cost of sending a team for 10 days is prohibitive.
Geographic spread is a major issue.
You’d wonder what the South Africans get out of it. The same could be said for their European counterparts – I can’t say partners in this instance because the South Africans are not even shareholders or stakeholders in the competition. Quite simply because they might just up sticks in a year or two.
At no stage would the Natal Sharks, Cape Stormers, Blue Bulls or Gauteng Lions consider joining on any level as they’re committed to Super Rugby.
I was over in New York last November and met with people involved with Major League Rugby and can clarify that there will be no American involvement in the PRO14 this season or for the very foreseeable future.
In terms of looking around Europe you could suggest a Romanian, Georgian, Spanish or German composite but you get the sense that Benetton and Zebre would knock the stuffing out of any of these proposed sides. You also get the feeling the PRO14 board are not sure where all this is going.
As for the Irish sides – well they dominate the competition and quite often the second string of Leinster, Munster and Ulster are good enough to guide them to the play-offs year in, year out. The issue with the Irish sides is that they don’t really take the matches that really count seriously. How many times particularly at Christmas do we see shadow sides play for Leinster v Munster – it just kills the league?
Would you even think that Irish Rugby would be bold enough to do a ‘state of origin’ three-match series between Munster and Leinster – three matches in a row. For a league to succeed you need to have a genuine edge between sides. None of the other sides in the competition can match the Irish for quality or edge. That is why the PRO14 is unsexy as well as lacking edge and real competition. If Leinster keep winning by 50 points when do people stop watching?
Examined
So the question still needs answering! Why would you buy a stake in this dreary competition for £116m– valuing it incredibly at over £400m (€445m)! PRO14 have sold their future profits forward but at what cost? How carefully have they examined what the consequences will be in five to ten years’ time?
CVC make their money from predicting or indeed shaping the future. What they are doing now is strategically mopping up slices of the pie so that they can make a move on the Six Nations.
Once they have enough traction and influence here they will go after the southern hemisphere and buy the whole game. They, just like they did with Formula 1, will control the game absolutely. Since when is it a good idea to have a hedge fund or a ruthless private equity fund running the affairs of the game of rugby union? They, not World Rugby, will call the shots.
They will milk that cash cow to death and eventually sell the game in 10 years to another hedge fund and pull a couple of billion out of it – while putting absolutely nothing in to the game itself.
The PRO14 have sold their soul to a coven of vampires and I guarantee you this – the PRO14 will not exist in five years’ time.
That house of cards will have come down spectacularly. Does anyone in authority in any of the unions know what they are doing?