Premiership Rugby clubs will each receive a windfall of about £13M ($16.5M) after the league sold a 27% stake to private equity firm CVC Capital Partners, “but they have been ordered not to blow the cash on player salaries,” according to Alex Lowe of the LONDON TIMES. The deal, believed to be worth more than £200M ($253.8M), will go through before the end of the season and the 13 shareholding clubs in the Premiership “have been urged to invest the money in stadiums and facilities.” Premiership player salaries have escalated by 44% since the ’14-15 season and league officials confirmed the salary cap of £7M ($8.9M) was “locked in” for the next two years as “a mechanism to try to control that rapid inflation.” CVC “will not be interested in the rugby” but focused on maximizing the Premiership’s commercial return, which the league said had grown by 80% over the past five years. CVC made its money in Formula 1 from sponsorship, TV rights and by “charging venues that host the grands prix” (LONDON TIMES, 12/20). In London, Gerard Meagher reported while some clubs such as Bath and Saracens “are likely to use the windfall for stadium redevelopments,” there are concerns other clubs “will look to strengthen their squads and thereby inflate rapidly growing wages.” Premiership CEO Mark McCafferty said, “We have a salary cap in place and that’s not moving for the next couple of years. We are investing in operations and infrastructure, that’s the key.” The Premiership “also eased fears over what happens when CVC decides to sell up.” McCafferty said, “They are expecting to be in this for the long term and they understand what’s required to invest and build. I expect Premiership Rugby in seven or eight years’ time to be an even more globally followed business. That expansion needs support” (GUARDIAN, 12/19). The BBC’s Chris Jones reported the Premiership has moved into a “new era.” Premiership Chair Ian Ritchie said, “This is a landmark new partnership. It is positive news for the league, the clubs and the game” (BBC, 12/19).
