After the news broke yesterday that CVC Capital Partners had made an offer in the region of £275m for a controlling stake in Premiership Rugby, The Times are reporting that the 13 Premier Rugby Ltd member clubs are not in unanimous agreement as to how to proceed.
Bruce Craig, who owns Bath, strongly opposes the offer and all PRL members would need to be on board and agree to the offer for it to go ahead, as has previously been agreed in the terms of the co-ownership of PRL.
With a meeting of the club owners set to take place on Tuesday, Craig’s opposition would be enough to prevent the sale to CVC and keep the controlling stake in PRL with the owners of the clubs.
With a net worth of £300m according to The Sunday Times Rich List in 2017 and a willingness to bankroll success and a new stadium for the club, Craig is one of the Premiership owners in a strong position to turn down the offer and retain the current control that the group has over the competition.
Whilst CVC have reportedly insisted that they will only exert voting control over commercial elements, something which has seen most clubs eager to accept the offer, it is still a concern for Craig and, it would be fair to assume, the RFU.
After initial success in 2016 at international level and a new heads of agreement between the RFU and the Premiership clubs, both guaranteeing player release and sufficiently compensating clubs for the loss of players, relations have begun to breakdown once more between the two bodies of English rugby and it is likely that any takeover by CVC would only exacerbate this. The private equity firm would likely look for a higher level of compensation for player release in subsequent negotiations and with the RFU currently facing financial issues, that could prove a stumbling block for the England side’s bid for success in international rugby.
According to the latest report in The Times, the ownership of Bristol Bears could also oppose the deal, having not yet made their position on the offer clear. With Bristol backed by Steve Lansdown, whose fortune is valued at over £1.4b, per that same Rich List report from 2017, they are another club not in need of the immediate injection of funds that the CVC offer would provide.
Either Craig will need to be persuaded of the benefits of the offer between now and Tuesday, or CVC will have to amend their offer, either increasing their financial investment and thus the valuation of the Premiership – which they currently value at £550m – or withdraw their demands for a controlling stake, something which it seems they are unlikely to do.
Failing either of those actions, it looks as though the deal could be dead in the water come Tuesday.
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