Sport | Victory for unions as SA Rugby agrees to appoint independent financial advisers

SA Rugby president Mark Alexander.

• SA Rugby’s General Council on Thursday took a significant decision in plotting their financial future. 
• This follows a difficult couple of months for the organisation since their failure to secure a private equity investment proposal by the Ackerley Sports Group (ASG) in December.
• The country’s top unions have encouraged SA Rugby to implement a more transparent process when conducting such deals in the future. 
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The country’s heavyweight unions landed a significant victory on Friday after the South African Rugby Union (SARU) confirmed it would appoint a financial institution to review its financial position.

The decision was taken at a General Council meeting held at OR Tambo International in Johannesburg on Thursday where SA Rugby’s members mandated the Executive Council and management to initiate a new process following the failure to reach the required 75% majority of a private equity investment proposal by the Ackerley Sports Group (ASG) in December.

READ | SA Rugby unions band together to plot way forward

Earlier in the week, the seven unions that in December were against the ASG private equity deal – the Bulls, Stormers, Sharks, South Western Districts, Griquas, Boland, and Free State – came together to provide SA Rugby with a ‘blueprint’ of due diligence and accepted practice they believe should be followed should such a deal be entertained again. 

In a signed letter that was sent by the unions and acknowledged by SA Rugby on Monday, half of the country’s rugby bodies asked SA Rugby to set up a Transaction Committee (TC) of six people to manage any future potential equity deals.

The six, according to the letter dated 20 January, must consist of two SA Rugby executives appointed by SA Rugby, two executives from SA Rugby’s members and/or its commercial affiliates, and two independent persons “with the necessary expertise in managing transactions of this nature, with a good understanding of the appropriate process and governance requirements (appointed by the other four members of the committee).”

Thursday’s developments appear to be a move in that direction. 

“The first step in the new process would be to appoint the financial institution through an independent selection process to advise members on all aspects of rugby’s financial sustainability and the role that a potential private equity investment might play,” SA Rugby said in a statement after the meeting.  

“We have been given a new mandate from the General Council to start a new process to review our commercial and financial prospects and define the process,” added SA Rugby president Mark Alexander. 

The financial advisors will be elected through an independent selection process while one representative each from the franchise unions and non-franchise unions, as well as two independent members of the Executive Council, would form the selection committee, supported by the SA Rugby CEO and CFO.

“We will take a measured and consultative approach under the guidance of the financial advisers as we review the financial challenges and opportunities,” Alexander added.

While a loss is expected for 2024, Alexander said that the work undertaken by management and strong commercial sales for 2025 had secured the organisation’s financial prospects for the next three years.