WPRFU boss responds to 'takeover bid'
REACTION: Western Province Rugby Football Union President Zelt Marais confirmed they have an equity offer on the table, but said it is early days yet.
Media reports in South Africa revealed that MVM Holdings, headed by leading South African lawyer Marco Masotti, submitted an agreement to the WPRFU earlier this month to buy a 51 percent stake in the Stormers for US$6-million (about ZAR99-million).
MVM Holdings is a New York-based Limited-Liability Company that is active on Wall Street.
While confirming the ‘offer’ Marais was unwilling to divulge any details.
“I do not wish to breach the confidentiality of the negotiations,” Marais said.
He added that it is too early to indicate what direction the talks could go.
“We have just begun with the negotiations last week.”
He also described some of the media reports as “grossly misleading”.
According to a report in Independent Media, Masotti said that the WPRFU expressed concern about giving up the controlling share of the Super Rugby side to a private equity firm.
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“The Western Province RFU has come back to us with the concern that they should keep the controlling share, but that they would give us an equitable share of the board [of the Stormers],” Masotti was quoted as saying by IOL.
“They want to keep control of rugby affairs and we could control the commercial affairs, but that wouldn’t work for us.
“There needs to be one controller and the guys that are involved in this bid have extensive experience in enterprises of this kind – we are talking about owners of NBA and ice hockey teams.”
Masotti – who said US$2-million (about ZAR33-million) of the US$6-million price tag would be invested into the WPRFU, while the remaining US$4-million (ZAR66-million) would go into the balance sheet of the Stormers’ board – suggested a takeover of the Stormers could lead to business opportunities with prominent sporting entities.
“The sport of rugby is stressed and needs change to survive and then flourish, and we see so much potential in Cape Town and the Stormers as a brand – they have iconic figures in an exciting team based in one of the world’s great cities,” he said.
“We see great opportunities to link the Stormers with [the] Milwaukee Bucks and grow the brand in Europe and States.”
However, it is unclear how ‘buying’ a stake in a company from the shareholder (WPRFU) is ‘investing’ into the union (WPRFU).
There are also questions around the leaking of information at such an early stage of negotiations.
It could easily be seen as an attempt to put pressure on WPRFU to accept their offer – a tactic to force the union’s hand.
The question could be asked: Is this a game of rugby politics, driven by a narrative to secure a back-ended takeover?
If the American company gets control, will they want to appoint coaches and recruit players?
Will there be a request for them to have a seat on the board of SA Rugby?
On the flip side, the chance to team inspirational Springbok and Stormers captain Siya Kolisi up with Bucks star and NBA MVP Giannis Antetokounmpo may well be a very attractive marketing ploy that lures the WPRFU across the line, especially given the financial landscape in a post-COVID-19 era.
* Additional reporting by IOL