US private equity firm Silver Lake is in talks over taking a stake in New Zealand Rugby, the body that runs the All Blacks, setting up a battle for influence in one of the world’s most popular sports.
Silver Lake is negotiating to take a 15 per cent stake in the commercial operations of the organisation that runs the New Zealand men’s team, which has dominated rugby union in recent decades, according to people briefed on the talks.
The structure of the deal is not clear, but other recent arrangements have involved sports governing bodies setting up their broadcasting and sponsorship businesses as new entities for private equity firms to invest in. New Zealand Rugby’s commercial rights could be valued at $2bn, according to those with knowledge of the talks.
If the deal is completed, it would make Silver Lake a powerful rival rugby investor to CVC Capital Partners. Many national teams consider playing the All Blacks as rugby’s greatest challenge, giving New Zealand Rugby considerable influence over the running of the sport worldwide.
Luxembourg-based CVC, which owns minority stakes in the English Premiership and Pro14 club competitions, has previously held talks with New Zealand Rugby over an investment, according to people familiar with those talks.
It is also in talks with the Six Nations over a €300m deal for Europe’s top tournament. The company hopes to use the influence that comes with its series of investments to put together media rights deals to offer broadcasters and to unify the commercial strategies of the groups that run the sport globally.
One person close to CVC said the involvement of another big investor might help its goal of expanding the global market for the game.
New Zealand Rugby is also a key shareholder in Sanzaar, a partnership that manages Super Rugby, a competition between many of the best clubs in the southern hemisphere, and the Rugby Championship, a national contest between New Zealand, South Africa, Australia and Argentina.
Sky News first reported the talks between Silver Lake and New Zealand Rugby on Monday.
New Zealand Rugby, which made a net loss of NZ$7.4m on revenues of NZ$187.1m in 2019, said in its latest annual report that it was “working with existing and potential partners to ensure we have the funding and reach we need”.
Jefferies, the investment bank, is advising New Zealand Rugby.
Silver Lake already owns stakes in some big sporting brands. In 2019, the owner of Manchester City sold a $500m stake to the firm, which had approached other top football clubs including Chelsea. Its other interests include Ultimate Fighting Championship, the mixed martial arts competition.