New Zealand Rugby boosted by huge cash injection
The All Blacks form a huddle during their Rugby World Cup match against France in Paris.
New Zealand Rugby (NZR) have announced that they will proceed with raising NZ$62.5 million through their existing underwrite with US private equity firm Silver Lake.
This, after consultation between the NZR board, 26 provincial unions, the NZ Maori Rugby board and and the New Zealand Rugby Players Association (NZRPA).
The announcement was made after the NZRPA were reportedly seeking to block the raise.
The decision means that Silver Lake’s interest in the commercial arm of NZR, known as ‘NZR Commercial’, will increase by 1.79% from 5.71% to 7.5%.
Equity deal approved in February
In February, the governing body approved a $200 million deal, whereby Silver Lake took the initial 5.71 percent stake which controls the organisation’s revenue generating assets.
NZR initially said it would offer equity worth as much as NZ$100m to domestic institutional investors, with most of that money being used to establish a Legacy Fund to support annual grants for several community rugby initiatives.
As a back up it gave approval for Silver Lake to take up to just over 8.5 percent of the company, if that public offering didn’t proceed.
“After careful evaluation of market conditions and support from external expertise, the NZR board recommended the previously agreed Silver Lake underwrite provided certainty and allowed the completion of the commitments approved by the members last year,” the NZR said in a press statement.
The deal means NZR now has a 92.5 percent stake in its commercial company.
NZR also said it “will now conclude the capital raise process which has already seen investment provided to NZR Commercial and stakeholders, including over 450 community rugby clubs, as well as the rebuilding of NZR reserves post Covid-19.”
READ MORE: Scott Robertson finalises ‘highly skilled’ All Blacks backroom staff