Private Equity - again

[Tommygilf]

3 minutes ago, Eddie said:

Fair enough too, as it would leave only 7 spaces for English teams outside of London. 

Why? Who says there's 2 clubs in France?

[The 4 of Us]

50 minutes ago, GeordieSaint said:

Is this what the coup was all about? FFS.

Exactly my thought. And all the recent suspects doing all for the love of the buffet. Someone is going to make a very nice sum out of this from within the sport, professing that it is for the good of the sport. 

As for the NRL, I suspect that this is a two fingered "come and get us" salute.

And doesn't this smack of the tail wagging the dog?!

"The NRL is understood to have wanted to buy into a 10-team competition, with clubs in London and France, and a plan to rebrand it as NRL Europe. This model was rejected by several established Super League clubs in the north of England, who were concerned about being shut out of the competition."

 

Edited October 14 by The 4 of Us

[Eddie]

6 minutes ago, Tommygilf said:

Why? Who says there's 2 clubs in France?

At the time iirc they said two clubs in France. 

[Tommygilf]

Just now, Eddie said:

At the time iirc they said two clubs in France. 

Would be odd hill for them to die on considering just the one club in each of New Zealand and Victoria. 

[Tommygilf]

https://www.totalrl.com/forums/index.php?/topic/401651-sl-clubs-look-to-reinstate-nigel-wood/page/103/#findComment-5360378

Even Mr Sadler thinks the owners wouldn't be "so stupid" as to go down the PE route...

[JohnM]

Breaking News: shares in deBeau Investments and uPVC Offcuts plc have soared on the news.

 

 

[gingerjon]

9 minutes ago, Tommygilf said:

https://www.totalrl.com/forums/index.php?/topic/401651-sl-clubs-look-to-reinstate-nigel-wood/page/103/#findComment-5360378

Even Mr Sadler thinks the owners wouldn't be "so stupid" as to go down the PE route...

"There is no chance of them doing that."

[Chrispmartha]

This would be absolute madness

[soulboy]

The 30 year shambles continues.

[Coggo]

Playing devil's advocate, maybe third-party investment will concentrate minds on profit motives, not power trips (no names mentioned, Derek).

[Martyn Sadler]

1 hour ago, Tommygilf said:

https://www.totalrl.com/forums/index.php?/topic/401651-sl-clubs-look-to-reinstate-nigel-wood/page/103/#findComment-5360378

Even Mr Sadler thinks the owners wouldn't be "so stupid" as to go down the PE route...

And I still think that.

They wouldn't be stupid enough to go down the same route as the Premiership RU clubs did with CVC.

The Rugby League club owners looked on with bemused horror at those clubs allowing CVC to take a sizeable chunk of their future broadcasting income.

I haven't spoken to a single one who would go down that route, other than Adam Pearson when he was the owner of Hull FC, and that was because he was running out of money.

The main benefit of the article is to let the NRL know that there are other potential investors who could be interested in buying a stake.

But any actual investment deals are an awful long way off.

 

[GeordieSaint]

2 minutes ago, Martyn Sadler said:

But any actual investment deals are an awful long way off.

I hope you are right… 

[Martyn Sadler]

2 minutes ago, GeordieSaint said:

I hope you are right… 

You don't need to hope.

[gingerjon]

6 minutes ago, Martyn Sadler said:

The Rugby League club owners looked on with bemused horror at those clubs allowing CVC to take a sizeable chunk of their future broadcasting income.

We've been doing this for a long time, Martyn, so you'll forgive me if I always over-analyse your words.

I think your phrasing here is potentially quite revealing.

[iffleyox]

3 hours ago, Mark S said:

The only upside is that the PE usually parachutes their own marketing team (in my experience, it could be a collective of business and agencies) into a business. 

Can you imagine the almost cosmically proportioned meltdown in some quarters if they parachuted in IMG?

[Worzel]

There’s no Private Equity model that doesn’t involve surrendering a share of future income. Their baseline is 3x investment back, most firms aim for 5x. 

Unless you have a business that can increase revenue by greater than 3x within a reasonable time horizon (5 years) then anybody selling a share to PE will end up far worse off. I say that as a bloke with PE partners.

The only “investors” that make sense for Super League are:

- Club owners, who are fans and don’t expect a return 

- The NRL, who have wider interests at stake and can visualise a synergy advantage 

- A partner like IMG, who will provide resources in exchange for a slice of future upside, but without expecting a % of everything from zero

Given what is being discussed is none of those things, then this is an appalling idea. But also given the sport is now being run by the Pie & Peas nincompoops, then it’s probably happening. 

[Derwent]

CVC take 27% of all Prem Rugby revenue. Not 27% of profit but of all central revenue including TV deals. If we did a similar deal, and I reckon they'd want a higher % because we are a bigger risk, then of the current Sky deal they would take about £6m of it per year.

[GeordieSaint]

10 minutes ago, Derwent said:

CVC take 27% of all Prem Rugby revenue. Not 27% of profit but of all central revenue including TV deals. If we did a similar deal, and I reckon they'd want a higher % because we are a bigger risk, then of the current Sky deal they would take about £6m of it per year.

It’s mental. A quick fix for long term pain. Let’s say the next TV deal is £30m. That’s an immediate loss £8.1m at 27% - just £21.9m to share across the clubs. Absolutely mental when you realise the club owners will spaff it away on overseas players and paying off ‘creditors’…

[gingerjon]

7 minutes ago, GeordieSaint said:

It’s mental. A quick fix for long term pain. Let’s say the next TV deal is £30m. That’s an immediate loss £8.1m at 27% - just £21.9m to share across the clubs. Absolutely mental when you realise the club owners will spaff it away on overseas players and paying off ‘creditors’…

But Martyn's confirmed it won't be future broadcast income.

It might be something else, or it might be a portion that can be contested as not a 'sizeable chunk'.

[Tommygilf]

1 hour ago, Martyn Sadler said:

And I still think that.

They wouldn't be stupid enough to go down the same route as the Premiership RU clubs did with CVC.

The Rugby League club owners looked on with bemused horror at those clubs allowing CVC to take a sizeable chunk of their future broadcasting income.

I haven't spoken to a single one who would go down that route, other than Adam Pearson when he was the owner of Hull FC, and that was because he was running out of money.

The main benefit of the article is to let the NRL know that there are other potential investors who could be interested in buying a stake.

But any actual investment deals are an awful long way off.

 

But why is it even being explored in that case then?

[Bull Mania]

This would he a disaster. As others said a quick fix that would give a cash injection, but handicap us for a long time. 

[Agbrigg]

18 minutes ago, Tommygilf said:

But why is it even being explored in that case then?

Well looking at the response of many sensible posters on here, they clearly suspect that there is some credence in this. Therefore they would hope the NRL may also see it that way also.

[Martyn Sadler]

19 minutes ago, Tommygilf said:

But why is it even being explored in that case then?

Because Rugby League is under capitalised.

But it's a slow burn.

[JohnM]

Advanced Notice: Don't miss this Thursday's episode of Dragon's Den, in which Nigel Wood, Derek Beaumont and Gary Hetherington ask for an investment of £20,000,000 in return for a 1% share of Odsal Stadium ticket income. 

[Tommygilf]

2 minutes ago, Martyn Sadler said:

Because Rugby League is under capitalised.

But it's a slow burn.

What does that even mean? And how slow can we afford it to be?