Might English rugby clubs become a target for American sports investors?
US money has been flowing into English soccer. Last fall, investors took minority stakes in Bournemouth and Crystal Palace. Buying into some of the Premiership’s lesser lights signaled growth potential and newfound cost controls trump the threat of relegation and regulation, the Financial Times reported.
Rugby enjoyed a highly profitable 2015 World Cup. But more than any other field sport with pretentions to a worldwide audience, its officials seek to tax and control commerce. The American union has historically begrudged entrepreneurship, while England is probably the most liquid market for franchises.
Last fall, USARFU sold a 15s license to PRO Rugby, which intends to run a 6-team, ‘single owner’ domestic league, just as in 2008 it took money from entrepreneur Bill Tatham for a 7s competition that never got off the ground. It’s not clear a USARFU license is a legal barrier to entry. Yet heavy-handed treatment of the Pacific Rugby Premiership and its predecessor, Rugby Premier League, hardly make American senior teams friendly to investors.
As a business proposition, England’s leading rugby clubs are some ways from their football cousins. The Barclays Premiership drew 13.7 million fans in 2014-15, making it the world’s 4th-biggest league by attendance, while the Aviva Premiership logged 1.8 million, not even in the top 50. A comparison of TV revenue is similarly lopsided: £5.1 billion ($7.4 billion) for a 3-year deal ending 2019 versus £152 million ($220.7 million) for a 3-year package through 2016.
But rugby's Premiership is third largest its kind, modestly behind the Southern hemisphere’s Super Rugby and the French Top 14. It’s an English-speaking competion; its franchises are privately held; and it’s situated in the world’s largest playing base, supplemented by the halo effect of the Six Nations.
Boulder has also gone into licensing foreign internationals (e.g., New Zealand-Ireland) and even club matches (London Irish-Saracens). Ironically, then, an American investor could exploit his ‘home’ market without having to contribute to its development.