Silver Lake buying a stake in the ABs?
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@DaGrubster said in Silver Lake buying a stake in the ABs?:
No it wasn’t going to and the plan wasn’t about generating short term revenue but putting long term revenue streams in place.
It does seem strange that they are paying interest to Silverlake?
I also find it hard to believe that they couldn’t get additional funding from financial institutions.
A sporting organisation like NZR is a low risk organisation as they are not in danger of collapsing and going out of existence.
From what I understand they not are they, and a good proportion $60 mill of the money is invested anyway, so not all spent. Depend if Mt Paul is correct or not, but for all I know they could be paying 2% a year , but I keep saying anyone thinking that Mark Robinson is the one who has done all the deal is living in a fantasy world. David Kirk etc all went over it with pretty fine toothcomb from memory before players assoc agreed to it.
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@Dan54 i might have really misunderstood, my understanding was they were going to be doing something proactive rather than investing it
so has silverlake come in with money and said they will invest it in the name of NZR...if we pay them a yearly fee (interest) AND then they get a share of profits?
thats seems very strange
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@ARHS said in Silver Lake buying a stake in the ABs?:
Still beats me why you would give so much away in the hope that someone less invested than you can do something you should have been able to do yourself.
I can understand the concept of bringing in expertise to develop additional revenue streams, and then rewarding that external expertise by giving them a percentage. But to simply provide them with a guaranteed return is ridiculously retarded. Any Econ 101 student could tell you why that's a bad idea, let alone people with MBAs.
And so far (admittedly I haven't been following this closely so could be wrong) it seems it's all about streaming. Which is 2020 speak for broadcast deals. Nothing about real diversification of income, developing assets etc.
The more light shed on this, the more thankful everyone should be the players' association appeared to do some due diligence.
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@Kiwiwomble said in Silver Lake buying a stake in the ABs?:
@Dan54 i might have really misunderstood, my understanding was they were going to be doing something proactive rather than investing it
so has silverlake come in with money and said they will invest it in the name of NZR...if we pay them a yearly fee (interest) AND then they get a share of profits?
thats seems very strange
Have no idea what the actual agreement is, just NZR always said $60 mill was going into lagcy fund, said it right from beginning. Have no idea about if they are paying Silver Lake a percentage of anything. But the money was always to go to provinces clubs as well.
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@Dan54 im actually concerned if theyre looking too long term...some clubs and unions and competitions might not be around to see the profit
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@Kiwiwomble mate at a guess there is more chance of clubs sticking around with help with finances to get people in the game. I seriously doubt whether any provincial unions won't be around though. And the whole idea is surely to look long term.
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@ARHS said in Silver Lake buying a stake in the ABs?:
Still beats me why you would give so much away in the hope that someone less invested than you can do something you should have been able to do yourself.
Nailed. I feel sick
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@ARHS said in Silver Lake buying a stake in the ABs?:
Still beats me why you would give so much away in the hope that someone less invested than you can do something you should have been able to do yourself.
Well haven't given it away, but from my uderstanding have sold 7% of profits to use the expertise that Silver Lake has. It's not that unusual in business to sell part of business to people with marketing expertise/contacts in areas that you don't have. Hell the biggest building company that I was contracted to in Aus did same, sold part of business to a company that developed sub-divisions, so they weren't tied up doing it, could concentrate on what they did, which was build. Wasn't unusual. same happened in place I worked in Levin back in 1980s, in fabric business.
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@Tim said in Silver Lake buying a stake in the ABs?:
@Dan54 said in Silver Lake buying a stake in the ABs?:
have sold 7% of profits
Hopelessly wrong.
Wasn't unusual. same happened in place I worked in Levin back in 1980s, in fabric business.
Really great stuff.
Using as an example , you do what you know and team up with companies to get expertise. I only mentioned the Levin one to show I personally have seen ot done twice where I had something to do with companies. It happens quite often.
Hopelessly wrong? This is what was always written about deal.
At the conclusion of the additional co-investment, Silver Lake will own between 5.71-8.58% of NZR CommercialCo (representing NZD $200-300 million investment, depending on capital needs and the uptake of New Zealand-based institutional investors) -
@Machpants said in Silver Lake buying a stake in the ABs?:
@Dan54 Sadly it is not 7% of profits, that would be OK - it is (whatever percentage) of INCOME, regardless of profit
So what is it? I have only seen figure I posted above, and it maybe expanded if Silver Lake take the other $100 mill of shares. From what I am able to work out with my very Ltd knowledge the $10 mill Silver Lake is getting at moment is actually their share of income, and not really interest (though it looks good in paper). NZR has an income of well over $100 mill a year. Broadcast deal alone is $90 mill, and I think sponsorship comes well over $50mill.
As I say, that's my Ltd knowledge, but some on here may have an actual copy of agreement that says different. -
@Dan54 Have you not comprehended any one of the 500 posts of this thread?
Silver Lake have not bought shares in NZ Rugby that pay out a proportionate share of profits, they have purchased a proportion of revenue. This is not a normal investment, nor venture capital, it is a guaranteed payment regardless of profit status.
You are posting like you know more than everyone, and you have no clue as to the nature of the deal.
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ARHS has the summary.
I cant accept they sold equity, does my head in.
I own a business I can give top employees a profit share if I want as an incentive and an income. That's not losing equity.
NZR sold equity . Yeah nah.
Last 5 years has been a shocker. You can't draw a line under this. -
@Tim said in Silver Lake buying a stake in the ABs?:
@Dan54 Have you not comprehended any one of the 500 posts of this thread?
Silver Lake have not bought shares in NZ Rugby that pay out a proportionate share of profits, they have purchased a proportion of revenue. This is not a normal investment, nor venture capital, it is a guaranteed payment regardless of profit status.
You are posting like you know more than everyone, and you have no clue as to the nature of the deal.
I have read many of the posts, generally from people who know as much as me, I realise that the payment comes from income, and why I understood it's in Silver Lake's interest to increase income. As I say, I find it hard to comprehend we on a forum know more about whether it good or bad business practice, the deal that has been done. The NZR has as many board members on the commercial identity that has been formed as Silver Lake , and that identity/board is who approves strategy.
I assure you I don't think I know any more or less than anyone else on subject, just what I have read. Also think the comments made by a few on here suggesting it all a deal done by Robinson (and not by a whole identity) etc and his Uni degree etc is crap, just not helpful at all.
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In their heyday Carter and McCaw wouldn't believe this to be true.
Well it is and I'm whinging.
I would much rather have a simplified / downsized domestic NZ rugby competition and even accepted a lower World rugby ranking in the near future than the path they have chosen. -
does anyone know, is the "interest" payment the same as the income share? or are we paying them this on to of whatever they're guaranteed to get from income?
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@BerniesCorner said in Silver Lake buying a stake in the ABs?:
ARHS has the summary.
I cant accept they sold equity, does my head in.
I own a business I can give top employees a profit share if I want as an incentive and an income. That's not losing equity.
NZR sold equity . Yeah nah.
Last 5 years has been a shocker. You can't draw a line under this.I would suggest your top employees aren't actually putting money into business to help it strengthen it's base, so not really comparing apples with apples are you? But anyway, that's enough of it.
We going around in circles, some know better about the deal than all the people on NZR , RUPA provincla boards , and some of us think they may have some idea of what they let themselves in for. Well the only person (a friend who has a business and is on provincial board0 I really know who's looked at it seems to think it quite reasonable (mind you he voted for it so maybe??) -
@Dan54 surely you can concede that people are known to make mistakes...look at how many bad movies get made with thousands of people working on them
And even if they havent made a mistake...there seems to be some confusion as to exactly what the deal is and what its trying to achieve
