A proposed partnership with Ackerley Sports Group has fallen through, leaving SA Rugby facing financial repercussions and calls for a governance review. The deal for a R1.4 billion investment in SA Rugby's commercial rights failed to secure the necessary 75% approval from local rugby unions, resulting in a R14 million loss in transaction fees.
The proposed partnership with Ackerley Sports Group, which sought to secure a R1.4 billion investment for a 20% stake in SA Rugby’s commercial rights, ultimately fell apart after failing to meet the crucial 75% approval threshold required from local rugby unions. The deal was rejected during a special meeting in December, leaving SARU to bear the brunt of significant financial repercussions.
A recent letter sent to provincial union heads reveals that SARU will be saddled with an estimated R14 million in transaction fees, a direct result of the unsuccessful deal. These fees are associated with professional services related to the failed bid and come without any commission payable to the involved parties. The breakdown of the situation was detailed in the letter, which also clarified that the agreement between SARU and its commercial agent, which facilitated the deal discussions, has now ended. The document further elaborated on the complex process SARU undertook in selecting Ackerley Sports Group as their preferred bidder after initial talks with other investors, such as CVC Capital, had fallen through. It also addressed the controversial 15% commission fee attached to the deal, which had been a sticking point for many involved in the negotiations. Compounding the situation, news emerged earlier that SARU’s CEO, Rian Oberholzer, had been appointed as the sole director of a private company called ‘Win By One’ months before the deal’s collapse, raising further questions about the process behind the selection of Ackerley Sports Group. In response to the failed deal and the associated costs, SARU has promised a governance review, which will include a closer look at the commission structure and the role of its commercial agents moving forward. This review is expected to provide further clarity on the financial decisions made during the deal’s negotiations and will aim to prevent similar issues in future dealings.
SARUGBY FINANCIALREPERCUSSIONS GOVERNANCEREVIEW ACKERLEYSPORTSGROUP INVESTMENT
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