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New Zealand Rugby agrees to meet players union on IPO proposal

Stand off over Silver Lake investment deal continues.

18 May 2021 Tom King
  • NZRPA say commercial rights should be valued higher
  • Governing body claims IPO is an inferior option

New Zealand Rugby (NZR), the national rugby union body, has offered to meet with the New Zealand Rugby Players’ Association (NZRPA) to discuss their suggestion of a public share float.

The NZRPA have proposed listing a stake in the All Blacks’ commercial rights on the New Zealand stock exchange as an alternative to the investment from US private equity firm Silver Lake.

NZR intends to sell a 12.5 per cent stake in its commercial rights to the investment company for NZ$387 million (US$270 million), a deal which would value the governing body's rights at NZ$3.1 billion (US$2.2 billion).

The deal has already been agreed by NZR but requires the approval of the NZRPA to be completed. However, the players union has consistently expressed its opposition to the deal threatening to block Silver Lake's plans.

Last week NZRPA and investment management company Forsyth Barr released an alternative proposal to sell a five per cent stake in NZR's commercial interests through an initial public offering (IPO).

The NZRPA and Forsyth Barr believe the valuation of NZR's commercial rights should be between NZ$$3.4 billion (US$2.45 billion) and NZ$$3.8 billion (US$2.74 billion), 12 to 23 per cent higher than the Silver Lake valuation.

The players union and Forsyth Barr claim that option would raise up to NZ$191 million (US$137 million), substantially less than the Silver Lake offer. However, they claim it would add the same amount of cash into amateur rugby as the Silver Lake proposal while also creating significant financial reserves for NZR.

The plans have already been dismissed by NZR who say an IPO would likely be assessed as an inferior option to other forms of passive, private capital investment. The governing body also expressed concerns that any negative performance of the share price could affect the team’s relationship with fans.


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