English tabloids have reported that former Formula One owners CVC Capital partners who made £8 billion from Formula One during an ownership period spanning 10 years have expressed an interest to acquire a controlling stake in Rugby Union English Premiership in a deal worth £275 million.
Since the league turned professional for the 1996-97 season, clubs have been struggling to break even and the recent financial outlook predicts that the figures will go even worse.
In the last accounting year, Exeter were the only Premiership club to make a profit while Wasps lost £3.7m and the Saracens, the European champions in 2017, posted a deficit of £2.8m, just to mention a few.
In other to make the game sustainable, the Rugby Premiership chiefs are exploring several options such as capping player wages which is currently pegged at £7m and the proposal by the private equity company CVC Capital Partners for a 51 percent stake. The other options which are available are selling a minority stake and borrowing money.
The interest from the private equity platform which manages over $50 billion worth of assets in Europe, Americas and Asia is a welcome development for Premiership Rugby and further underlines the growth and attraction the sport is making internationally.
A Spokesperson for Premiership Rugby had this to say: ‘Premiership Rugby and its clubs have grown quickly in the last five years with the help of major partnerships,’
The terms of the deal will is due to be presented by Premiership Rugby’s executive committee to the club owners after which it will have to be ratified by all the member clubs for the takeover to sail through.