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New Zealand Rugby will face a momentous decision on the future of the All Blacks at its annual meeting Thursday, when it debates whether to sell a stake in the commercial value of the national team to American investors.
New Zealand’s 26 provincial unions will vote on a recommendation from New Zealand Rugby that it should bundle its commercial interests into a new entity and sell a 12.5 percent stake in that entity to California-based Silver Lake Partners for 387.5 million New Zealand dollars (US$279 million).
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If the recommendation is carried, it will mark the first time in more than 115 years that the All Blacks — the most successful team in world rugby — do not wholly belong to New Zealanders.
Rugby officials argue the sale is necessary to secure the future financial sustainability of New Zealand Rugby after its finances were battered last year by the COVID-19 pandemic.
In documents to be presented to the annual meeting, NZR proposes transferring its commercial assets to a new company to be called Commercial LP and to transfer NZ$43.75 million ($31.5 million) from the sale price to that entity as operating capital.
A further NZ$39 million ($28 million) will be distributed to stakeholders, mainly the provincial unions, who are also cash-strapped after last year’s disrupted season.
NZR said it will also establish a legacy fund for "longer-term strategic initiatives to ensure the sustainability of all levels of rugby in New Zealand."
Silver Lake Partners was launched in 1999 and has focused mainly on investment in the technology sector with holdings in companies such as Airbnb, Twitter and Dell Technologies. It also holds a stake in City Football Group which owns the English Premier League club Manchester City and which it lists in its Content and Entertainment industry vertical.
NZR embarked on a nationwide "roadshow" tour to sell the Silver Lake deal to provincial unions.
But the concept faced push-back from professional players who have sought assurances that important traditional and cultural symbols such as the silver fern and the All Blacks’ haka will not be sold and commercialized. The All Blacks have won the Rugby World Cup three times and were also runners-up in 1995, making them the most successful team at the sport's global showpiece and confirming their long standing as a premier team in the game.
The recent, failed Super League in European soccer has also caused a tremor of concern among some New Zealand Rugby fans.
Those fans fear the attitudes of owners shown in the attempt to establish the Super League — an apparent indifference to history and to fans’ close attachment to their clubs — might also be reflected in the rugby deal.
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Opponents say the American investors are unlikely to be interested in the grassroots level of New Zealand's national sport, and likely to press for the All Blacks to play more matches in high-value markets overseas.
Silver Lake will seek to grow the value of its investment by enlarging the All Blacks’ fan base around the world but also by increasing income from current revenue streams such as broadcast deals, ticket sales and merchandise.