The proposed £300m deal by CVC to invest in the Guinness Six Nations could be put on a halt following the Coronavirus outbreak. Reports in the Financial Times have suggested that the deal, that is part of the investment company’s run to be one of the biggest commercial players in world sport.
£300m deal could be in jeopardy
The Luxembourg-based group have started rapidly investing in rugby as a plan to reshape the global game in a bid to make millions. CVC had formerly worked with Formula 1, but have since turned their attention to rugby.
In 2018, CVC acquired a 27% stake in Premiership Rugby, the top tier of English rugby for £200m. A deal worth around £120m for a stake in the Guinness Pro14 is expected to be passed in the coming weeks following clearance from those in power, according to those in direct knowledge.
Despite all their planning though a deal with the Six Nations could be put on hold following the disastrous financial implications of Covid-19. The deal was going to be a £300m stake for a 14% stake in rugby’s flagship annual competition.
Autumn Six Nations
Reports have also come out of plans to play the full tournament in the autumn, but how this would work is truly unknown as there would be a minimum of two games outside the international window, meaning clubs wouldn’t have to release players for those fixtures.
This would highly damage the credibility and commercial ability of the tournament, which heavily relies on sponsorship income.
The unions involved – WRU, RFU, IRFU, FIR, SRU and FFR – are concerned about pressing on with the deal with four fixtures postponed and a lack of financial clarity due to the hit taken on ticket sales and matchday income.
The Six Nations said, in the Financial Times: “We have not agreed to either take a break nor to push through a completed agreement. The conversations are simply ongoing and obviously take into account the new environment created by the current pandemic. CVC declined to comment.
It’s expected that the deal could still be struck later this year with the investment group looking at ambitious £600m plans for the game.
CVC investment propping up sides
The only completed deal, in Premiership Rugby, is seeing the £15m per club investment go towards ensuring they survive during the pandemic, with initial plans earmarking the cash for infrastructure and marketing spending.
CVC has held back from taking its roughly £10m share of distributions that it is entitled to from the Premiership.
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