SA Rugby failed to get a majority vote in favour of Ackerley Sports Group obtaining a share in the company’s commercial rights.
Saru will have to cough up R14-million after its general council voted against Ackerley Sports Group’s private equity bid last month.
ASG’s proposal – worth R1.4-billion for a 20% stake in SA Rugby’s commercial rights – failed to meet the 75% threshold it required, with only six of the 13 voting unions in favour of it.
“In terms of the agreement reached between the commercial agent and Saru, the said agreement now terminates,” Saru said in a letter sent to union heads last Friday.
“Saru will be liable for all professional transaction fees directly and these professional transactional fees are estimated at R14-million with no commission payable.”
Commission fee
The letter also addressed the controversial 15% commission fee that was reportedly a major factor in the bid’s failure.
“The commission payable to commercial agent for successfully concluding an equity transaction was set at 15% of the transaction value,” Saru said.
“This commission was a gross percentage against which the equity transaction professional and transactional costs would be paid by the commercial agent on behalf of Saru which professional fees were estimated to be 5% of the 15%.”
This story first appeared on sarugbymag.co.za. It is republished here with permission. For the original story click here.
