The potential history-making vote to approve a $200m private equity deal between New Zealand Rugby and US investment firm Silver Lake has been delayed.
The deal, which will see Silver Lake pay $200m to hold a five per cent stake in NZR's commercial assets, needs to be ratified by the provincial unions.
The intention was for the vote to take place at NZR's annual general meeting on April 28, but the Herald understands that will no longer be happening.
It is understood that the unions have asked for more time to evaluate the deal which carries a level of complexity and is significantly different to the original Silver Lake investment proposal which they approved last year.
The deal the unions approved last year was to sell a 12.5 stake to Silver Lake for $387.5m – but it was a proposal that failed to win the backing of the Rugby Players' Association.
The proposal had to be majorly reworked to win the approval of the RPA and in February this year, a new deal was announced – one that had the players' blessing, but was of such material difference to the 2021 version, that it would require for the provincial unions to ratify it at the AGM.
There are several points of difference in the new deal, the most significant being that while Silver Lake will initially invest $200m, there will also be a second capital raise later this year which will allow domestic institutions such as KiwiSaver funds and ACC to co-invest alongside the US firm.
Under the terms of the new deal, Silver Lake's investment will effectively act as a bank loan for the first three years with a four per cent interest rate.
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It will convert to an equity stake in 2025 compared with the first deal which would have seen Silver Lake immediately come in as an equity partner and enjoy higher returns.
Also, the new deal will see Silver Lake, RPA and NZR co-jointly create a vehicle called Global Rugby Opportunities which will look to invest in rugby-related technology business and possibly other national unions and competitions.
Major accountancy firm PricewaterhouseCoopers were commissioned by NZR to independently review the new deal and their report was only made available to the provincial unions late last week.
The Herald has not seen the report but understands that PWC do not raise any red flags in their findings other than reiterating what many other analysts have already said, which is that for the deal to stack up financially, Silver Lake will need to deliver on the relatively ambitious revenue targets they have forecast.
One other factor that may be troubling the provincial unions is that an independent review of NZR's governance structure and processes has been agreed as part of the deal.
When the RPA rejected the initial deal last year, they agreed to come back to the negotiating table on the condition that regardless of whether a deal was later agreed with Silver Lake or not, that the national body would put its governance under the most intense scrutiny to determine whether it was fit for purpose.
It is believed that NZR chief executive Mark Robinson has written to the unions to inform them that the Silver Lake vote won't be taking place at the AGM and that he is hopeful that within the next few weeks, a date will be set to hold the vote at a Special General Meeting.