Rupert Prince Posted November 8, 2020 Author Share Posted November 8, 2020 8 hours ago, BrisbaneRhino said: Private equity investment is definitely a double-edged sword, as you pretty much have to sell your soul to get the cash. I don't see a single club being big enough to be of any interest to serious private equity investors - throw in whatever you want in terms of the stadium and on its own its still basically a small business. SL as a whole might be big enough, but they would only invest with a view to earning a big return, which would require fundamental changes to the sport which might not sit well with a lot of fans - like franchising, expansion to bigger cities, overseas etc. They wouldn't give a rats about any smaller heartland clubs. Why is private equity paying 27% (?) of Premiership Rugby? Why are Premiership Rugby selling it? Link to comment Share on other sites More sharing options...
cookey Posted November 8, 2020 Share Posted November 8, 2020 Because the Premiership clubs need the cash,at least half a dozen of them do. They have taken the cash(around £15 mill each I believe),supposedly to 'invest',although the rumours are that much of the money has already been spent to repay various loans. They hope that PE will somehow magically increase the total value of RU,so that their remaining 70%,becomes worth more than their previous 100%. Paul Daniels is advising them! Clubs like Worcester,Irish,Newcastle,Wasps desperately need short term cash,just like the RL clubs but on a bigger scale. Link to comment Share on other sites More sharing options...
Rupert Prince Posted November 8, 2020 Author Share Posted November 8, 2020 1 hour ago, The Future is League said: We've had 125 years to grow in this country and basically we've failed If you read above what I written, you will see that professional rugby union in England is concentrated in the west of the region. It has not stopped private equity buying into it. Link to comment Share on other sites More sharing options...
Rupert Prince Posted November 8, 2020 Author Share Posted November 8, 2020 6 minutes ago, cookey said: Because the Premiership clubs need the cash,at least half a dozen of them do. They have taken the cash(around £15 mill each I believe),supposedly to 'invest',although the rumours are that much of the money has already been spent to repay various loans. They hope that PE will somehow magically increase the total value of RU,so that their remaining 70%,becomes worth more than their previous 100%. Paul Daniels is advising them! Clubs like Worcester,Irish,Newcastle,Wasps desperately need short term cash,just like the RL clubs but on a bigger scale. Yes...? And... Link to comment Share on other sites More sharing options...
del capo Posted November 8, 2020 Share Posted November 8, 2020 5 minutes ago, Rupert Prince said: Why is private equity paying 27% (?) of Premiership Rugby? Why are Premiership Rugby selling it? As a move towards control of the RU game and through its players the Internationals ( where the real money is ). They initially bid for a controlling interest, As for the Premiership Rugby angle , the club owners were and still are millions in the red and saw a way to recoup some of their losses whilst by selling only 27% for the moment still retain a semblance of control. I expect CVC to come at them again. They like to control the sports they invest in and on the face of it seem pretty ruthless in their pursuit of a return . Hull KR too small to interest them but if that opened the door for SL as a whole and we bit ( lets face it our club owners are in the same spot as RU ones ) then CVC would have a massive say in the future of both codes. And I wonder what that future would look like ? Link to comment Share on other sites More sharing options...
Rupert Prince Posted November 8, 2020 Author Share Posted November 8, 2020 17 minutes ago, del capo said: As a move towards control of the RU game and through its players the Internationals ( where the real money is ). They initially bid for a controlling interest, As for the Premiership Rugby angle , the club owners were and still are millions in the red and saw a way to recoup some of their losses whilst by selling only 27% for the moment still retain a semblance of control. I expect CVC to come at them again. They like to control the sports they invest in and on the face of it seem pretty ruthless in their pursuit of a return . Hull KR too small to interest them but if that opened the door for SL as a whole and we bit ( lets face it our club owners are in the same spot as RU ones ) then CVC would have a massive say in the future of both codes. And I wonder what that future would look like ? Of course they will have some say in what happens. They are putting up money. But they also have benefits, advice, influence. Link to comment Share on other sites More sharing options...
Blind side johnny Posted November 8, 2020 Share Posted November 8, 2020 14 hours ago, Rupert Prince said: Isnt the point of 'investment' to grow and provide a return? Can you provide an example of this in British RL? Sport, amongst other things, is a dream-world offering escape from harsh reality and the disturbing prospect of change. Link to comment Share on other sites More sharing options...
Blind side johnny Posted November 8, 2020 Share Posted November 8, 2020 1 hour ago, Rupert Prince said: Why is private equity paying 27% (?) of Premiership Rugby? Why are Premiership Rugby selling it? Because the owners were desperate to get some of their "investment" back before it becomes worthless. Sport, amongst other things, is a dream-world offering escape from harsh reality and the disturbing prospect of change. Link to comment Share on other sites More sharing options...
del capo Posted November 8, 2020 Share Posted November 8, 2020 6 minutes ago, Rupert Prince said: Of course they will have some say in what happens. They are putting up money. But they also have benefits, advice, influence. Benefactors ? Hedge funds are the hardest face of capitalism. They bring talent to the table of course but it is used to suit their own ends - the return on their investment - rather than for instance the social values for which our game is so highly valued.. Ask the average F1 fan what they think of them. Down to only three engine manufacturers now I believe..... Link to comment Share on other sites More sharing options...
super major Posted November 8, 2020 Share Posted November 8, 2020 6 hours ago, cookey said: Private Equity aren't generous benefactors,they solely exist to make substantial returns on equity,15- 20 % annually.Frankly they would run circles around any rugby club. Which is why I do not see the attraction of HKR to them even accepting all the attractiveness listed above Link to comment Share on other sites More sharing options...
del capo Posted November 8, 2020 Share Posted November 8, 2020 4 minutes ago, super major said: Which is why I do not see the attraction of HKR to them even accepting all the attractiveness listed above A foot in the camp at a cost to them of really small change Link to comment Share on other sites More sharing options...
Rupert Prince Posted November 8, 2020 Author Share Posted November 8, 2020 5 hours ago, Blind side johnny said: Because the owners were desperate to get some of their "investment" back before it becomes worthless. But the investors obviously are happy to just throw their money away... ? Don't you think you are missing the point? Link to comment Share on other sites More sharing options...
Blind side johnny Posted November 8, 2020 Share Posted November 8, 2020 1 hour ago, Rupert Prince said: But the investors obviously are happy to just throw their money away... ? Don't you think you are missing the point? No. In the big brave new world of pro RU there were a queue of people who thought that they could turn a profit from investing in clubs. When they realised how wrong they were then many of them looked for ways to retrieve some of their losses. As has been detailed by others the investors looking to get involved in RU will screw them down to guarantee a return; that's how private equity works. Pro RL has many more years of experience to tap into that would tell any investor that their money is unlikely to be returned and that the assets of the sport are actually minimal. Sport, amongst other things, is a dream-world offering escape from harsh reality and the disturbing prospect of change. Link to comment Share on other sites More sharing options...
redjonn Posted November 9, 2020 Share Posted November 9, 2020 On 08/11/2020 at 10:34, del capo said: As a move towards control of the RU game and through its players the Internationals ( where the real money is ). They initially bid for a controlling interest, As for the Premiership Rugby angle , the club owners were and still are millions in the red and saw a way to recoup some of their losses whilst by selling only 27% for the moment still retain a semblance of control. I expect CVC to come at them again. They like to control the sports they invest in and on the face of it seem pretty ruthless in their pursuit of a return . Hull KR too small to interest them but if that opened the door for SL as a whole and we bit ( lets face it our club owners are in the same spot as RU ones ) then CVC would have a massive say in the future of both codes. And I wonder what that future would look like ? That's my main concern, CVC having major say/control of both codes. RU are constantly changing the rules to improve the entertainment and will continue to do so. The codes will inevitably get closer on the pitch over a number of years. Both codes have 4/5 clubs much stronger financially than the financial struggling which holds them back. It would seem from a pure Equity investment perspective that bringing those clubs together sometime in the future may be a direction that makes sense. Especially trying to compete with the juggernaut of Premier League and wider football, let alone the inroads American sport such as NFL/NBA are hoping to make into the UK sports market. Of course those fears are longer term... but things can over rapidly and long can quickly become medium term. Link to comment Share on other sites More sharing options...
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