(Reuters) – The New Zealand Rugby (NZR) organization has decided to move forward with a NZ$62.5 million ($39.24 million) capital raise, utilizing its existing Silver Lake underwrite. This decision comes after successfully securing agreement from its voting members and 26 provincial unions.
As a result of the capital raise, Silver Lake’s stake in the commercial arm of NZR, known as ‘NZR Commercial’, will increase to 7.5% from 5.71%, according to a statement released by NZR on Friday.
Earlier this year, NZR agreed to sell an initial stake to Silver Lake for NZ$200 million after obtaining agreement from the players’ union.
In considering institutional investors for the capital raise, the governing body ultimately chose the Silver Lake underwrite, citing the “certainty” it provided, NZR said.
“NZR will now conclude the capital raise process which has already seen investment provided to NZR Commercial and stakeholders, including over 450 community rugby clubs, as well as the rebuilding of NZR reserves post COVID-19,” NZR stated.
The decision to proceed with the capital raise follows reports that the New Zealand Rugby Players Association (NZRPA) was attempting to block the raise.
At this time, the players’ union was not available for immediate comment.
In its statement, NZR mentioned that it had consulted with the NZRPA regarding the capital raise but did not confirm whether the union had given its endorsement.
An NZR spokesperson clarified that the governing body did not require the union’s endorsement for the capital raise to move forward.
NZR revealed that the capital raise and the creation of a ‘Legacy Fund’ with committed capital of NZ$60 million were the final two remaining components of the initial Silver Lake deal.
The fund, according to NZR, will be established as an endowment to further grow the game from the “grassroots up” and provide support for annual grants for community rugby initiatives.
($1 = 1.5929 New Zealand dollars)
(Reporting by Ian Ransom in Melbourne; Editing by Peter Rutherford)
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