The Rugby Australia (RA) governing body has unveiled a financing agreement with private equity firm Pacific Equity Partners (PEP), concluding its capital raise program.
An upsized and flexible AU$80 million ($52.8 million) credit facility has now been confirmed, on a five-year term, and will be used to develop the game in Australia, with a focus on women’s rugby, community, and pathways.
The organizing body had been undergoing an assessment of different capital-raising options with the Jefferies Australia advisory firm before selecting PEP as a partner.
Over the next six years, there are multiple opportunities for RA to secure substantial revenues – Australia will host the British and Irish Lions touring side in 2025, as well as the men’s Rugby World Cup (RWC) in 2027 and the women’s edition in 2029.
Phil Waugh, chief executive at Rugby Australia, has now said: “RA has been assessing various capital raise alternatives with Jefferies Australia for more than a year.
”We plan to invest in the critical areas needed to grow the game – we have identified high-performance integration, women’s rugby, community, and pathways as critical areas to focus on, and I believe investment in these areas will give us the opportunity to capitalize on the exciting major events on the horizon.”
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He added: "Given the visibility we have on revenues from the British and Irish Lions and World Cups, it became clear that debt capital was going to be the best solution for Rugby," Waugh added.
“This does not compromise RA’s options down the road, which could include private equity investment.
“This approach ensures that we retain 100% of the commercial revenues from the game, that all capital raised will go into the game, and that RA controls its own direction during this next period of growth and development.”
Earlier this month, RA replaced Hamish McLennan as chair with Daniel Herbert.
Following a late-night meeting on November 19, McLennan was ousted as chair and then “resigned from the board" to be replaced by former national team (the Wallabies) player Herbert.
Herbert, meanwhile, played 67 tests for Australia and won the RWC in 1999.
He has been on the RA board since 2020, while his current role is as chief executive at SSKB Strata Managers, a body corporate management firm. Across 2015 and 2016, he was the executive general manager at the Queensland Reds domestic rugby union side.
To add to the turmoil surrounding RA, it was reported earlier this month that trading and investing platform eToro is set to let its commercial deal with the body expire at the end of 2023.
The deal from May 2021 was signed through December 31 this year, and will now not be renewed, according to media reports.
Australia crashed out of the 2023 men's RWC in humiliating fashion, failing to make it out of the group stages.