Rugby boss shocked by ‘breach of trust’ by RPA
New Zealand Rugby boss Mark Robinson has hit back at the Players’ Association’s “attempt to destroy the Silver Lake deal”, saying the governing body was not aware of the counteroffer tabled by Kiwi investment manager Forsyth Barr.
An alternative offer to Silver Lake, valuing NZ Rugby at a $3.8 billion, has been tabled by Forsyth Barr, a proposal conducted at the request of the New Zealand Rugby Players’ Association which is not supportive of selling a stake in the national game to the US fund manager.
The Auckland head-quartered company has conducted due diligence on the prospect of NZR selling a 5 per cent stake in its future commercial revenues through an NZX listing and believes investor demand could potentially raise as much as $650m.
Under the terms of the Forsyth proposal, NZR would be able to raise between $170m and $190m, with as much as 40 per cent of the offering being open to mum and dad investors who could buy in for as little as $100.
However, Robinson claimed NZR had not seen the proposal when approached by the NZ Herald, adding that he was “disappointed” by NZRPA boss Rob Nichol leaking the proposal to the media beforehand.
“We are shocked and disappointed that Rob Nichol has shared another counter-proposal with media before sharing it with New
Zealand Rugby,” Robinson said in a statement to the Herald.
“As such we have not had sufficient time to digest or understand what has been proposed or comment on the detail.
“Further, it includes confidential information about our organisation that we have not consented to being made public or shared with Forsyth Barr or any other professional entity.
“This is a fundamental breach of trust and the partnership which up until now we valued highly.”
Robinson said NZR is not willing to enter debate over alternative proposals.
“NZR has no desire to continue to play out an ill-informed ‘my model is better than yours’ debate — nor do we think the public like it — and we would have rather continued to constructively negotiate with Rob Nichol and his Board which we have made clear.
“Through doing this, the NZRPA leadership has unilaterally taken a decision to attempt to destroy the Silver Lake deal — and the incredible financial and capability outcomes it would provide for all of rugby, as acknowledged by the unanimous vote of our Provincial Unions and Maori Rugby Board as well as the independent validation of the deal by PWC and global investment bank Jefferies.
“We are sorry, that for the players, their own Union has put them in this position where the greatest opportunity for the future of all of Rugby in New Zealand could be lost.”
Forsyth managing director Neil Paviour-Smith says that his firm is willing to underwrite the deal as a number of significant fund management houses and high net worth New Zealanders have already indicated they would make significant investments.
Such a deal would, therefore, be deemed low-risk and value NZR at between $3.4b and $3.8b, which is 12 per cent to 23 per cent higher than the valuation offered by Silver Lake.
The Silver Lake deal, for which NZR has received the backing of provincial unions to proceed, will raise $387.5m and see the US group take 12.5 per cent of net revenue.
In a leaked email to NZ Rugby staff obtained by the Herald, Robinson said NZR’s relationship with NZRPA was “at a new low”.
“We have been advised this morning, at very late notice, that the New Zealand Rugby Players’ Association has released to the media an alternative capital raising option for rugby in New Zealand — based on initial public offering (IPO) model to sell 5 per cent of an NZR CommercialCo.
“We believe their proposal, which has been worked up together with Forsyth Barr, will go public at midday or soon after,” the email said.
“We are incredibly disappointed with this turn of events, and have just now sent the below statement to media as an initial response. To have the NZRPA prepare this work, without any notification or involvement of NZR, and without any legal consent to utilise our information in doing so, and then present it to media before ourselves, sadly represents a new low in our relationship with the NZRPA and the critical discussions over the financial future of the game.
“We are in contact with our Provincial Unions and other stakeholders and will update staff further once we know more. There will be significant media interest in this story and we are working hard to ensure that NZR’s voice is heard effectively on this over the coming hours and days.”