Tattarang seeks exclusivity in Rugby Australia investor search
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Executive departure dramas and desert jamborees aside, Andrew and Nicola Forrest’s well-oiled private investment vehicle Tattarang rolls on.
Street Talk understands the John Hartman-led vehicle – the ultimate parent of most of the Forrest empire’s interests and the holder of the family’s shares in Fortescue Metals – has entered a final round of negotiations to be Rugby Australia’s new investor.
The formal talks, which got underway last week, follow a one-on-one meeting between Hartman and Rugby Australia boss Hamish McLennan at Tattarang’s waterfront offices in Perth in late August. The latter is seeking exclusivity on the deal, sources say.
Jefferies-advised Rugby Australia has been on the hunt for a $250 million growth capital injection at a valuation said to be about $2 billion. Tattarang is vying for the asset with global buyout fund CVC Capital Partners, which has ridden the sporting M&A boom hard, investing in the likes of La Liga, Spain’s top soccer division, and US private equity firm Silver Lake, which invested $200 million in Rugby New Zealand in 2022.
To win over private equity, Rugby Australia is promising returns generated from broadcasting and streaming rights, merchandise revenues and ticket sales, said McLennan.
It’s no secret Forrest is passionate about local businesses and brands. He’s funded the Western Force rugby team in Perth – showing he’s willing to back an underdog, and more than doubled earnings at Australian boot maker and saddler RM Williams to $45 million, since investing three years ago.
Rugby Australia made a $4.5 million operating loss in 2021 on revenue of $98.6 million, up from a $27 million operating loss in 2020. In 2022, it made an $8.2 million profit on revenue of $129.2 million.
Despite the loss, McLennan expressed confidence Rugby Australia can leverage the sport’s “golden decade” to increase revenues and return to profitability.
Last month, it announced a major restructure whereby it would gain control over key management, coaching and talent decisions at the country’s five Super Rugby clubs.
The NSW Waratahs, Queensland Reds, Canberra Brumbies, Melbourne Rebels and Western Force agreed to pursue a model that would give RA oversight of high-performance programs and key personnel changes at Super Rugby Pacific and Super W.
RA signed a $100 million, three-year broadcast rights agreement with Nine Entertainment in November 2020, and is gearing up to compete in the men’s Rugby World Cup, due to kick off in France later this week.
Once complete, it is expected to be the biggest restructure in Australian rugby union history.
