Rival bidder for SA’s Springboks plans fan stake

The national team ‘is a symbol of excellence and we have absolutely no doubt that if the opportunity presented itself for South Africans to invest in the Springboks, they will do so in the millions,’ Karan said.

A consortium interested in bidding for a stake in the commercial rights of South Africa’s Springboks wants to give fans an opportunity to invest in the reigning rugby-union world champions.

Read: South African rugby unions block Ackerley private equity bid

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The member unions of SA Rugby – which oversees the national team – on Friday rejected its plan to sell a 20% stake in a newly created commercial-rights company for $75 million to Seattle-based Ackerley Sports Group LLC. While the American firm has an exclusivity period until the end of this year to make a revised offer, local investors have expressed interest in acquiring a share of the rights.

A consortium comprising Altvest Capital, investment platform EasyEquities, 27four Investment Managers and RainFin has submitted a proposal to buy as much as 40% of the commercial rights through a special purpose vehicle.

Read: South African Rugby gets rival R6.7bn rights bid, BD says

If successful, the group plans to list the SPV on Johannesburg’s stock exchange and allow retail investors to buy shares for as little as one rand ($0.06) through EasyEquities, Alvest’s Chief Investment Officer Akshay Karan said in an interview.

The national team “is a symbol of excellence and we have absolutely no doubt that if the opportunity presented itself for South Africans to invest in the Springboks, they will do so in the millions,” Karan said. “No South African who loves this investment opportunity, or is passionate about the Springboks, should be excluded from investing at an amount that is affordable to them because the minimum entry point is too expensive.”

Read: SA Rugby says it risks collapsing without equity deal

The consortium will also make provisions for institutions, venture partners and high-net-worth individuals to own stakes in the commercial rights, as well as floating a debt instrument to attract fixed-income investors, according to a copy of an expression of interest letter submitted to SA Rugby. The sports body acknowledged receipt of the letter, but no further discussions have taken place because of Ackerley’s exclusivity period, Karan said.

The group’s working estimate for the value of the commercial rights entity is at least $375 million, which would put any potential bid it may make at least on par with Ackerley’s, he said. Still, it expects fees and costs to be lower than that of the American company. SA Rugby’s member unions raised concerns about the fee structure and governance aspects of the rejected deal, as well as potential changes to the body’s commercialisation and revenue mechanisms.

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Read/listen: Saru responds to why equity sale plan has been kicked into touch … for now

The governing body, which has barely turned a profit for over a decade, told lawmakers it risks collapse if it doesn’t boost revenue or secure a commercial deal.

Read: SA Rugby postpones vote on Springboks private equity deal

The Springboks have won the World Cup a record four times. Once regarded as an emblem of apartheid due to its formerly all-White composition, it’s now seen as an icon of successful racial integration with a Black captain and representatives from most of the country’s largest ethnic and religious groups.

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