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#Post#: 12252--------------------------------------------------
CVC deal for 35% of Prem
DIR By: Blucherquin
Date: December 12, 2018, 2:39 pm
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Here we go - the beginning of the end of the sport we love.
Don’t say I didn’t warn you when there are midweek games, games
abroad, law changes.
Here’s the killer paragraph:
“a landmark moment that will allow clubs to make the next wave
of investment on grounds and fan experience.“
Rugby is....(insert swear word)
From the Guardian.
Premiership Rugby hopes to conclude a £230m agreement with a
private equity firm before Christmas after a board meeting on
Tuesday failed to tie up a few loose ends.
When the 13 shareholders in Premiership Rugby, made up of the 12
clubs in the top flight plus London Irish, first discussed the
proposal in September they rejected it, not least because CVC
Capital Partners wanted a 50% stake.
This week’s meeting at Heathrow agreed the deal – which would
give CVC a 35% stake – in principle, leaving the executive arm
of Premiership Rugby to sort out the unresolved issues in the
next two weeks.
“There remains unanimity about our approach and our desire to
enter into a requirement for a significant investment which we
think will herald a new era for the league,” said the
Premiership Rugby chairman, Ian Ritchie. “We remain on track in
achieving our objectives but nothing has yet been concluded.
“These discussions are inevitably complex and take whatever time
is necessary. We had a good meeting and have a shared objective.
We are still in discussions and they will continue. We have to
take time to make sure things are done in the right way.”
Clubs would each receive around £18m if the deal goes through
but they would be better off in the long-term only if income
from central funds rose by significantly more than the 35% stake
CVC is looking to take.
The company would take that percentage from the pot each year,
meaning that if it did not grow the clubs’ annual income would
shrink. They were reassured the lump sum they receive will be a
windfall with proceeds from sponsorship and broadcasting deals
expected to rise significantly if CVC gets involved.
CVC, which used to own Formula One, would have no say in the
running of the league but would lead its commercial arm. “We are
not there yet because discussions like this one are not
straightforward,” said the Premiership Rugby chief executive,
Mark McCafferty. “It is a question of time rather than principle
and we would like to resolve this before Christmas.
“It always comes down to a few issues and we will work through
them. Nothing is done until it’s done and it will not drag on.
With the collective will around the table today, we can find the
answers to those items. If we get there, it will be a landmark
moment that will allow clubs to make the next wave of investment
on grounds and fan experience.
#Post#: 12266--------------------------------------------------
Re: CVC deal for 35% of Prem
DIR By: DOK
Date: December 13, 2018, 3:01 am
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Is this the end of rugby on free to air then?
#Post#: 12272--------------------------------------------------
Re: CVC deal for 35% of Prem
DIR By: deadlyfrom5yardsout
Date: December 13, 2018, 4:10 am
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FTA channels still have to pay to broadcast I'd imagine?
#Post#: 12276--------------------------------------------------
Re: CVC deal for 35% of Prem
DIR By: Fearless Fred
Date: December 13, 2018, 4:34 am
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Remember, this is for the Premiership only. It won't impact on
the current International broadcast rights. At the moment we've
only had Premiership rugby on FTA for something like a year (I
think I'm right in saying BG10 was the first game broadcast by
C5). Before that you have to go back decades to the days of
Gradstand for *any* rugby on TV, and it was predominantly RL
that was broadcast at a club level. We currently have 5 games a
year on C5, alongside the highlights show. That's not a lot. If
CVC want to get their money back, they need to get a)
bigger/more sponsors involved and b) more eyes to see that
sponsorship.
#Post#: 12277--------------------------------------------------
Re: CVC deal for 35% of Prem
DIR By: Blucherquin
Date: December 13, 2018, 4:42 am
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Yeah there is/hasn’t been any free to air club rugby worth
watching other than the tiny bits thrown to C4 as part of their
deal as a secondary rights holder.
#Post#: 12279--------------------------------------------------
Re: CVC deal for 35% of Prem
DIR By: AllyMac
Date: December 13, 2018, 5:16 am
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Discounting the £18m per club initial windfall (which based on
my experience of how agents work, a substantial part of which
will make its way into the players hands, rather than being
spent on infrastructure and improving the fan experience),
simplistically speaking if CVC take 35% of the money generated
from the central pot at the end of year one, unless they have
managed to generate an additional 47% additional income during
that first year, the clubs will all be worse off. An earlier
Guardian article (from September 2018 I believe) showed how
little CVC Capital Partners have actually contributed to Formula
One, and how, instead of growing the sport, they have made it
less popular, both amongst fans and amongst sponsors. It sounds
to me like Premier Rugby are opting for short term gain in
return for long term pain.
#Post#: 12280--------------------------------------------------
Re: CVC deal for 35% of Prem
DIR By: Blucherquin
Date: December 13, 2018, 5:22 am
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--- Quote from: AllyMac link ---
>
> Discounting the £18m per club initial windfall (which based on
my experience of how agents work, a substantial part of which
will make its way into the players hands, rather than being
spent on infrastructure and improving the fan experience),
simplistically speaking if CVC take 35% of the money generated
from the central pot at the end of year one, unless they have
managed to generate an additional 47% additional income during
that first year, the clubs will all be worse off. An earlier
Guardian article (from September 2018 I believe) showed how
little CVC Capital Partners have actually contributed to Formula
One, and how, instead of growing the sport, they have made it
less popular, both amongst fans and amongst sponsors. It sounds
to me like Premier Rugby are opting for short term gain in
return for long term pain.
>
--- End Quote ---
A point I've made endlessly on here.
This deal is going to see the clubs make less and less money.
#Post#: 12286--------------------------------------------------
Re: CVC deal for 35% of Prem
DIR By: Monte
Date: December 13, 2018, 7:22 am
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Well what I don’t want is for Premiership rugby to go to Amazon
nor to have it split between Sky and BT. Sky is so expensive per
month for anyone not interested in football, BT is working that
way but at present much cheaper.
#Post#: 12288--------------------------------------------------
Re: CVC deal for 35% of Prem
DIR By: Blucherquin
Date: December 13, 2018, 7:44 am
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--- Quote from: Monte link ---
>
> Well what I don’t want is for Premiership rugby to go to
Amazon nor to have it split between Sky and BT. Sky is so
expensive per month for anyone not interested in football, BT is
working that way but at present much cheaper.
>
--- End Quote ---
Will be interesting to see what happens next round. BT's
strategy of buying a lot in order to increase broadband
subscribers hasn't worked, and Sky have got new owners, football
is everything to both of them.
#Post#: 12289--------------------------------------------------
Re: CVC deal for 35% of Prem
DIR By: AllyMac
Date: December 13, 2018, 8:30 am
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--- Quote from: Monte link ---
>
> Well what I don’t want is for Premiership rugby to go to
Amazon nor to have it split between Sky and BT. Sky is so
expensive per month for anyone not interested in football, BT is
working that way but at present much cheaper.
>
--- End Quote ---
According to the September Guardian article, the only ways in
which CVC managed to increase the income generated through
Formula One was via the TV rights and by staging races at
circuits where the owners were prepared to pay more, hence the
fact we now have a Russian GP, Bahrain GP, Azerbaijan GP, and so
on (countries with alleged histories of serious Human Rights
abuses). Also, from the 2019 season onwards, Formula One will
only be seen on Pay to View TV.
If this is the model that CVC intend to follow with rugby, (as
under the terms of the deal it would appear that they will be
heavily involved with the commercial aspects of the league)
expect the cost of watching our team play on the TV to skyrocket
and for us to be playing teams from countries who are willing to
pay the most to host games. Fancy a trip to Azerbaijan anyone?
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