A consortium of US-based sports investors has bought a controlling stake in South African rugby union franchise the Sharks, highlighting the growing attractiveness of Africa’s sports landscape to international business.
New York-based MVM Holdings, a group led by investor Marco Masotti and featuring Marc Lasry, owner of the National Basketball Association’s Milwaukee Bucks and Doug Cifu, owner of the National Hockey League’s Florida Panthers, will take a 51% stake in the Durban-based franchise as it joins other South African franchises in the expansion of the European-based Guinness Pro14 competition. The financial terms of the deal are undisclosed.
Other investors include financiers Vincent Mai, Robert Haswell, Dominic Silvester and Michael Yormark, the president of Roc Nation Sports International, the sports management division of the entertainment agency founded by rapper and entrepreneur Jay-Z. Roc Nation will assist with the global expansion of the Sharks brand.
The Sharks’ current shareholders, the KwaZulu-Natal Rugby Union and SuperSport International, will hold the remaining 49% of the franchise.
Global rugby shakeup
In recent years, the Sharks competed in the Super Rugby competition, mostly alongside teams from rugby’s traditional southern hemisphere of South Africa, Australia and New Zealand. But in September, the South African Rugby Union opted to switch the Sharks and fellow franchises the Bulls, Lions, and Stormers to the European-based Guinness Pro14 competition, which features clubs from Ireland, Italy, Scotland and Wale
South Africa’s sides will be introduced to the Pro14 teams from April 2021 in a new Rainbow Cup competition before the planned permanent move.
A statement from The Sharks highlighted a “transformational change” currently underway in the international rugby investment landscape, illustrated by private equity firm CVC Capital Partners’ $163m purchase of a 28% stake in the Guinness Pro14 in May 2020. In another high-profile acquisition in 2018, CVC bought a 27% minority stake in Premiership Rugby, the leading English competition, for around $270m.
The move was spearheaded by Sharks fan Masotti, an advisor to asset management firms, who grew up in the Amanzimtoti coastal town south of Durban.
“The Sharks have a deep and wonderful history that can translate into a formidable global rugby brand.” he said in a statement.
“Our investment is designed to facilitate the expansion of the franchise through deep relationships with business people, financing sources and other sporting codes.”
Brian Van Zyl, the newly-elected president of the KwaZulu-Natal Rugby Union, predicted that the deal will bring “greater commercial savviness” and international ties.
Other US sports brands, lured by Africa’s young population and sponsorship opportunities, have invested in the continent. Earlier this year, the NBA launched the Basketball Africa League in conjunction with the International Basketball Federation, which features twelve professional teams from across the continent.