UPDATE: NZ Rugby get $465 million private investment offer from US company

A United States tech giant has offered New Zealand Rugby nearly half a billion dollars for a 15 per cent share of commercial rights, a report says.

The offer has come from US firm Silver Lake, which part owns Manchester City’s owner City Football Group and is known as one of the world’s leading technology investors, and requires the approval of New Zealand’s provincial rugby unions.

Silver Lake’s minority stake could range from 10-15 per cent of commercial rights valued at $3.1 billion, NZME reported on Wednesday.

A decision is unlikely to be taken before NZ Rugby’s annual meeting in April. The NZ Rugby Players’ Association, as well as former All Blacks players, coaches and Black Ferns are also to be consulted, the report said.

Last year, NZ Rugby chief executive Mark Robinson said the company was “keeping its options open” on private equity as the game enters a period of dynamic change.

NZ Rugby is consulting with its stakeholders but a spokesperson said on Wednesday evening there was no further comment to make at this time.

“As we have said [previously], we are on a path to look at what an investor partner for New Zealand Rugby might look like – which is a very exciting prospect for us.”

Recently, Stuff spoke to Colin McKinnon, the executive director of NZ Private Capital, to get a clearer understanding of how the industry operates and why NZ Rugby is open to investment.

NZ Rugby and a private equity firm such as Silver Lake would create an entity to handle commercial assets, and private equity would take a share of this, perhaps 10-15 per cent. “At the moment NZ Rugby funds itself through a different kind of partner,” McKinnon says. “They have got some big sponsors and when they get capital from those sponsors they give them something in return. A similar thing happens with a private equity company. They invest some capital and for that capital they take on a share in the risk in the business but they are also expecting through their help and expertise they will be able to grow that business.”

Source: Stuff