February 28, 2020 / 4:39 AM / a month ago

Major shake-up on cards for New Zealand rugby as financial uncertainty bites

WELLINGTON (Reuters) - New Zealand Rugby (NZR) launched a consultation process on Friday that could see a major shake-up of how the game in the rugby-mad country is run and financed, which could include the injection of private equity.

The consultation process stems from a review of the health of a sport that is facing financial uncertainty and significant reductions in player numbers and fan interest.

NZR Chief Executive Mark Robinson told reporters that investigating the injection of private equity from the likes of venture capitalists like CVC, who have also pursued stakes in northern hemisphere rugby, was on the cards.

“The balance here is that we’re keeping all options open around future opportunities in this space,” Robinson said in comments published by Stuff Media, when asked if there had been talks with CVC.

“There’s a wide range of things happening across the globe at present in this area and we’re simply keeping our options open at the moment.”

Robinson’s confirmation they were talking to private equity follows World Rugby Chief Executive Brett Gosper confirming to the Financial Times in Britain this week the global governing body was also discussing a link with CVC.

The company already own a share of England’s Premiership club competition and are pursuing a stake in the Six Nations.

NZR is projected to lose about NZ$30m over the next five years and the organisation continually fights to retain their player pool domestically with players lured to more lucrative opportunities in Europe and Japan.

A report by management consultants McKinsey that sparked the consultation process identified five areas that should be examined, including the high-performance pathway into professional rugby and how the game is administered.

It identified about NZ$20 million-$30 million in “inefficiencies” that could be saved and ploughed back into the game and Robinson acknowledged there could be job losses across rugby.

“They’ll be conversations that we have with those people at the appropriate times,” he said.

“There could be a whole range of different options in that space, we’ll just have to work through that.”

“This is not a short-term cost cutting process.

“This is a process where we hope to realise significant value that goes straight back into the game and can target some of those areas where we think we have got opportunities for improvement.”

Reporting by Greg Stutchbury; Editing by Robert Birsel

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