Premiership Rugby has declined to accept a £275m offer from the private equity firm CVC for a 51% share because the clubs are fearful of handing control to a third party. With collective losses of around £35m, the clubs remain on the lookout for fresh investment but at Tuesday’s board meeting they unanimously agreed that selling a majority share was “not the preferred option”.
With agreement among all 13 shareholders – the 12 Premiership clubs plus London Irish – required for any sale in excess of 25%, and significant opposition from several owners, CVC’s offer was never likely to be accepted on Tuesday. Still, it is a setback for the clubs most in need of a cash injection considering the £17m windfall that would have come their way.
Ian Ritchie, chairman of Premiership Rugby, confirmed that a number of other interested investors have come forward since news of CVC’s offer emerged last week but that they would be seeking a minority investment and plan to move fast.
“The majority sale is something that’s not the preferred option because again we think that control is something that by and large we would want to keep within the clubs,” said Ritchie. “But we would look at minority stakes, people who are either investors or who can bring added value to that, and again there was a good unanimity around the table of wanting to pursue that further.”
Last week Premiership Rugby’s chief executive, Mark McCafferty, suggested that the organisation could become a billion-pound business within 10 years and there was also a feeling among some owners that CVC’s offer was too low. Ultimately however, losing too much control proved the stumbling block.
“Ian and I have a good mandate from today about what the shareholders want to see,” said McCafferty. “So that’s given us exactly the clarity we want. I think you know us well enough that one of the things we don’t do is hang around. Now we would be looking to move to the next stage relatively quickly, because there’s a lot of opportunities out there in terms of what we want to do to grow the business.”
