Cape Town – Becoming a major player in the global market and building enough reserves to counter any future pandemics may become a realisation for the South African Rugby Union once they complete a private equity transaction.
That was the word from Mark Alexander, who was re-elected for a final four-year term as president of SA Rugby at Friday’s annual general meeting.
SA Rugby are understood to be in the final stages of securing an equity deal with CVC – who are already involved with the Six Nations, United Rugby Championship and the English Premiership – for a percentage of the organisation, which would bring in a significant boost to its coffers.
It would be especially welcome after a torrid few years commercially due to Covid-19, which caused serious pay-cuts and other austerity measures in the local rugby landscape in 2020.
Things improved in the last financial year, especially with the world champion Springboks back on the pitch in 2021 after they weren’t in action at all in 2020, with the British and Irish Lions tour vital in that regard – although the fact that spectators weren’t allowed at match venues made things even more difficult.
Friday’s AGM saw SA Rugby reporting a small surplus for the year of R8.9 million, while revenue increased by 80% on 2020, going up from R710m to R1.283 billion, which almost took it back to pre-Covid levels (R1.296b in 2019).
But that doesn’t mean the local game is out of the woods yet, with Saru CEO Jurie Roux warning: “The return to play of the Springboks and the delivery of the Lions series were critical to the survival of the sport in 2021. Had we not been able to deliver those events, we would have been closing rugby’s doors by year end.
“Having said that, the fact that the pandemic prevented the attendance of supporters at Springbok Tests and at provincial matches means the sport remains in a precarious position.
“Last year was supposed to be the year that we built up reserves from the windfall of a British & Irish Lions tour… Covid-19 denied us that opportunity. The tour meant we were able to break even, but if we are hit by an event of a similar magnitude, we have zero reserves to weather it.”
That is why the private equity deal is crucial to the future of the game in South Africa. “Alexander said the priorities off the field remained focused on digital initiatives and fan engagement, as well as the completion of a private equity transaction which had the potential to be game changing for the sport,” the Saru statement read.
Alexander said: “Such a transaction will provide external capital to invest in our objectives and put Saru in a stronger financial position for the immediate and longer term.
“It will allow us to accelerate our digital plans, place SA Rugby firmly in the global market and provide a reserves capacity to weather future pandemics.
“We are still in recovery from the impact of the pandemic, and the global financial crisis before it, and we have immediate short-term challenges. But there are great opportunities and eak new ground at the annual meeting to have female representatives from all our members in attendance. We are at the start of a very exciting journey in the women’s game.
“The growth and potential for women’s rugby in South Africa is enormous, and it was particularly gratifying to break new ground at the annual meeting to have female representatives from all our members in attendance. We are at the start of a very exciting journey in the women’s game.
“The relaxation of the final restrictions on venue attendance is the last piece in the short-term jigsaw. We look forward to being able to host sell-out crowds when the Springboks return to action in July (against Wales).”