ARU expansion promise: Victorians told they were next

[travelling_gerry]

Wayne Smith | May 21, 2009

Article from: The Australian

THE Australian Rugby Union in late 2005 promised the Victorian Government it would negotiate exclusively with Melbourne for the city to be awarded a Super rugby team in any expansion of the competition.

The letter, from the then chief executive of the ARU, Gary Flowers, to Dr Peter Hertan, chief executive of Sport and Recreation Victoria, was sent in the strained aftermath of the ARU's controversial decision to award the Super 14 licence to Perth ahead of Melbourne.

In it, Flowers strongly indicated that if the Victorian Government went ahead with plans to build the proposed rectangular pitch stadium at Olympic Park, Melbourne would be its candidate to host a new team when the competition was enlarged in 2009 or 2010.

The stadium is nearing completion but Melbourne now finds itself locked in a three-horse race with the Gold Coast and a newly revealed Sydney consortium to be chosen as the ARU's candidate for the new team when Super 14 expands to Super 15 in 2011.

Flowers resigned as ARU chief executive in 2007, to be replaced by John O'Neill, but the commitment to the Victorian Government was one very much made by the organisation, not the individual.

"(The) ARU has already publicly stated that Melbourne is well-equipped and capable of hosting a successful Super franchise," the letter stated. "We have strong ambitions to build a fifth team to compete in the next iteration of Super 14 from 2011. Although this aspiration requires us to persuade our SANZAR partners and our own board of its merits, and of course requires financial, commercial and player sustainability, it is the ARU management's view that Melbourne has an absolutely outstanding opportunity to be the location of such a team.

"Without compromising the need to build financial support for the team, it would be our intention at the appropriate time in 2009 or 2010 to negotiate exclusively with Melbourne for hosting such a team if such opportunities arose."

Seemingly the "appropriate time" has now arisen following the decision of last week's SANZAR summit in Dublin to proceed with the planned expansion to a Super 15 in 2011, with the new team to be based in the Australian conference.

The Victorian Government declined to comment on the apparent "if you build it we will come" commitment in the letter when contacted by The Australian yesterday, but Sports Minister James Merlino was upbeat about Melbourne's candidacy.

"Melbourne is the perfect fit for a new team, particularly with the iconic $267million rectangular stadium soon to be completed," Merlino said.

Whether the new ARU administration under O'Neill believes itself bound by a 2005 commitment remains to be seen. But certainly what has changed is the ownership model the ARU now has in mind, with O'Neill wanting to bring in private equity.

The Victorian Government has no intention of buying into any new Melbourne team and believes that it already has done more than enough to support rugby by building the rectangular stadium and providing the Victorian Rugby Union with offices there.

VRU chairman Gary Gray said his organisation already was in discussions with corporate Melbourne about private backing for a Super 15 team but he, like the man heading up the rival Gold Coast consortium, Terry Jackman, is unsure how the ARU intends private equity involvement to work.

Jackman, meanwhile, will meet with Gold Coast Rugby Union chairman Murray D'Almeida and chief executive Tim Rowlands tomorrow to finalise its bid team, having already secured the support of Gold Coast mayor Ron Clarke.

And in a new development, former Sydney Kings chief executive Gary Hudson and Tony Hay, the former chairman of the Western Sydney Regional Council, have been identified as the key figures behind the Sydney-based Super 15 bid.

Meanwhile, barely has SANZAR come through the acrimonious process of agreeing to an expansion to a Super 15 conference structure, than it has come to light the it has already discussed a Super 18 in 2013, with Japan providing two of the three extra teams.

It is understood there are future plans to add a fourth Atlanta Conference, involving teams from Argentina, Uruguay, the US and Canada.

Additional reporting: Peter Kogoy

http://www.theaustralian.news.com.au...015651,00.html

[Burgs]

If they are the best option then they don't have anything to worry about, if not then they better sharpen their pencil, there's no future in the past.

[sandgroperrugby]

With the expansion of the AFL into the Gold Coast I think the ARU needs to hit back and send the troops into the centre of the storm (no pun intended). Melbourne is the biggest sporting capital in Australia and the potential for expanding the game and Rugby Unions survival in Australia demand we get into the biggest market. Melbourne represents new sponsors and a whole new raft of sporting fanatics that like me are sick AFL not to mention the immigrant crowd.

I would never have said this prior to the RugbyWA winning the bid but hey I would be lying if I told you I wasn’t thinking it at the time. IMHO

[normie]

With the expansion of the AFL into the Gold Coast I think the ARU needs to hit back... Melbourne is the biggest sporting capital in Australia and the potential for expanding the game and Rugby Unions survival in Australia demand we get into the biggest market. Melbourne represents new sponsors and a whole new raft of sporting fanatics that like me are sick AFL not to mention the immigrant crowd.

Absolutely! Melbourne might be the centre of the universe as far as Aussie rules is concerned, but by and large Melbournites are also sports nuts. Significantly, the large number of expats from rugby playing countries living in Melbourne will no doubt jump on board a local S15 team. It makes a lot of sense to base a team there.

[jargan83]

why they would even consider putting another side in Queensland when the Reds are struggling is beyond me

[Swee_82]

Not knowing any detail, Melbourne seems the next logical place for a Super team.

I'm wondering, since we already have the Reds and Waratahs, do they suddenly become the QLD (except the flashy bit) Reds and NSW (but not within a 15km radius of Parramatta) Waratahs??

Those from north of the border are at their rabid best, wearing Maroon and screaming "Queenslander!!!" at the top of their lungs. Let's not dilute it.

[AndyS]

Got to agree. The Gold Coast and West Sydney would be obvious locations for teams in a domestic competition, but Super Rugby needs the tribalism generated by the state divide.

[mudskipper]

Melbourne.... but he Gold coast will put a good bid in... QLD is a league state...

[jargan83]

so is NSW
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[AndyS]

One thing for damn sure, we better hope it is Melbourne!

If it isn't, they will be applying all sorts of pressure on the ARU to fill the stadium that they were told to build. At the same time, there's RugbyWA telling all and sundry that their finances are buggered until they get a stadium and no committment on the part of Government to do anything but look at it and talk....

Anyone remember the Heineken Classic?

[tic]

The model the ARU wants is not consistent with how the VRU wants to do things.

The ARU model is the only one that could spare rugby being screwed in this country.

If the VRU don't adapt, they may well be in for a nasty shock. The Victorians think that they can establish a franchise and then raid the other three provinces. The ARU has made it clear that they won't let that happen again. They at least got that part right.

[AndyS]

Maybe I am missing something...this private equity, will it be a gift or interest free loan? Anything else will imply a return on investment, and most business ventures would be looking for at least 10%. With the other franchises, that is all money that goes into rugby - why is it better that it will go into someone's pocket instead?

And what does it have to do with raiding of the other franchises? If the ARU can block that from happening, then it surely doesn't matter how the franchise is financed. Arguably, the ARU would have more leverage to prevent the VRU from poaching than some private entity - if it were my money they were spending, I'd expect them to find me the best players for the least money. If that meant poaching them, then so be it.

[beige]

49% share perhaps?

[AndyS]

So, a gift then - they provide money but get no say in how it is used.

[beige]

Pretty much - the only way they could push their own decisions would be to convince someone in the VRU to agree with them. I never I said I've put any thought in to it - it was just something I remember being floated in a rugby magazine a couple of years ago...