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Author Topic: CVC deal for 35% of Prem  (Read 1400 times)

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DazzaS

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Re: CVC deal for 35% of Prem
« Reply #30 on: Wednesday 19-Dec-2018, 19:58* »
The decline in premiership rugby is now accelerating!

Tonbridge Quin

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Re: CVC deal for 35% of Prem
« Reply #31 on: Thursday 20-Dec-2018, 14:15* »
Anyone any thoughts on what Quins might do with their 'windfall'? Clear existing debt? Investment in the new stadium?

honkytonk

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Re: CVC deal for 35% of Prem
« Reply #32 on: Thursday 20-Dec-2018, 14:23* »
I guessed go towards stadium

Fearless Fred

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Re: CVC deal for 35% of Prem
« Reply #33 on: Thursday 20-Dec-2018, 15:10* »
Almost certainly going towards investment in the new stadium and associated facilities

Quaking Quin

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Re: CVC deal for 35% of Prem
« Reply #34 on: Friday 21-Dec-2018, 01:09* »
Sounds like ring-fencing by the back door.

If the agreement is only with the existing 13 stakeholders where does that leave room for any other ambitious championship club to join?

Camquin

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Re: CVC deal for 35% of Prem
« Reply #35 on: Friday 21-Dec-2018, 08:42* »
The 13 own shares in PRL.
There is a mechanism for the promoted club to buy shares over time, but it is one of the inequities as they are not automatically transferred, so the promted club gets less moeny tha every other club in the league and the relegated club has a budget several times that of the Championship clubs.

deadlyfrom5yardsout

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Re: CVC deal for 35% of Prem
« Reply #36 on: Friday 21-Dec-2018, 09:06* »
So you are just moving the problem down one level really.

Gone

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Re: CVC deal for 35% of Prem
« Reply #37 on: Friday 21-Dec-2018, 09:13* »
Sounds like ring-fencing by the back door.

If the agreement is only with the existing 13 stakeholders where does that leave room for any other ambitious championship club to join?

It's a one-off payment. So won't make a difference - other than the teams now all need to start to work out where and how to make up what will be diminishing TV revenue year after year.

deadlyfrom5yardsout

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Re: CVC deal for 35% of Prem
« Reply #38 on: Friday 21-Dec-2018, 09:40* »
I thought the point was that CVC will increase TV/Sponsorship/Advertising revenues by such an amount that we wont miss the 35%? Surely CVC would not be throwing 200M down the tubes?

Gone

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Re: CVC deal for 35% of Prem
« Reply #39 on: Friday 21-Dec-2018, 09:54* »
I thought the point was that CVC will increase TV/Sponsorship/Advertising revenues by such an amount that we wont miss the 35%? Surely CVC would not be throwing 200M down the tubes?

CVC will increase TV and marketing revenue massively - but they will take all the cash. That's the deal.


deadlyfrom5yardsout

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Re: CVC deal for 35% of Prem
« Reply #40 on: Friday 21-Dec-2018, 10:08* »
eh? They will take 35% of it only I believe?

Gone

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Re: CVC deal for 35% of Prem
« Reply #41 on: Friday 21-Dec-2018, 10:16* »
eh? They will take 35% of it only I believe?

Well yes, I'm only really going on what i've read about the analysis of how they work -- build up market value then strip cash and run.

Camquin

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Re: CVC deal for 35% of Prem
« Reply #42 on: Friday 21-Dec-2018, 10:23* »
CVC only lose if the revenue falls otherwise the will make their money back - they would lose baddly if PRL lost the rights to promote top level rugby.
The cubs only gain if CVC manage to increase PRL's profits more than 30% - if it turns out their are not loads of markets wanting to buy rugby highlights packages then the clubs lose in the long run.


deadlyfrom5yardsout

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Re: CVC deal for 35% of Prem
« Reply #43 on: Friday 21-Dec-2018, 10:26* »
CVC were prepared 500M for the lot so they must see value there.

AllyMac

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Re: CVC deal for 35% of Prem
« Reply #44 on: Friday 21-Dec-2018, 10:31* »
eh? They will take 35% of it only I believe?

They've purchased 37%, so they will expect to receive 37% of the revenue. CVC will not be involved in the day to day running of the league, but instead will bring their "expertise" to the commercial side of things, including sponsorship and TV revenue.  However, and this is where the problem lies, the majority of Premier Rugby's income is generated from TV and sponsorship, and therefore in order just to stand still, CVC will have to increase TV and sponsorship revenue by approximately 150% per annum. Given that sponsorship and TV deals are normally for a set period of time, unless the timing of this has been done to coincide with the renewal of these contracts, the clubs are going to be a lot worse off in the initial years. Therefore, the idea that the money is going to be spent on infrastructure will not come to fruition, as the money will need to be spent on the day to day running costs of the clubs, or for paying down debt.

 

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