Premiership rugby hails ‘landmark’ deal with equity firm
LONDON: Premiership Rugby hailed a “landmark” deal with CVC Capital Partners on Thursday after the private equity firm acquired a reported 27 percent stake worth more than £200 million ($254 million).
CVC, which had previous involvement in MotoGP and Formula One, initially sought a majority shareholding but that was rejected by the umbrella organisation for the English Premiership.
The clubs voted unanimously to accept the new deal, with the funds raised earmarked for developing facilities and stadiums and expanding the competition into new markets rather than paying increasing players’ wages.
Member clubs will benefit from a multi-million cash injection, according to reports. Premiership clubs recorded losses of a combined £28.5 million in 2016/17.
“Premiership Rugby confirms a landmark new partnership with leading private equity and investment advisory firm CVC Capital Partners,” said a statement.
“The investment... into Premiership Rugby marks the start of a new era for English professional club rugby.”
“We’re happy that CVC’s track record speaks for itself,” said Premiership Rugby chief executive Mark McCafferty.
“They were in MotoGP for eight years and only came out of that because of the requirements for moving into Formula One. They were in Formula One for the best part of 10 years.
“They are expecting to be in this for the long term and they understand what’s required to invest and build.”
McCafferty said the investment will help to broaden the appeal of the competition both at home and abroad.
“I expect Premiership Rugby in seven or eight years’ time to be an even more globally followed business. That expansion needs support,” he said.
“The clubs see this as a way to accelerate growth and bring new fans into the game and opening up audiences.”
“We have a salary cap in place and that’s not moving for the next couple of years,” he added. “We are investing in operations and infrastructure, that’s the key.”