Provincial rugby union based group to run Crusaders

Getty Images     19 Dec 2012     Getty Images

The licence has been awarded to the Crusaders Limited Partnership which is owned by all six Crusaders unions - Canterbury, Tasman, South Canterbury, Mid Canterbury, Buller and West Coast.

"We are pleased to confirm today details around the Crusaders licence which will ensure that the Crusaders begin next year better equipped to face the challenges of the highly competitive market that rugby operates in," said NZRU Chief Executive Steve Tew.

"We set out on this process to deliver a more sustainable commercial model for Super Rugby franchises so they can better look after the interests of teams, fans, sponsors and rugby and we are thrilled the Crusaders now join the Hurricanes in that regard."

A licence to manage the Hurricanes was earlier awarded to a Wellington group comprising the Wellington Rugby Football Union and local investors.

"We believe that the new Crusaders Limited Partnership is a really positive step forward for the Crusaders," said current Crusaders Chairman Murray Ellis. "It puts us on a sound financial footing and provides certainty and stability for the future.

"We are particularly proud that the licence agreement for the Crusaders will see rugby continuing to 'own' rugby. We believe that in our case, the future of the Crusaders is best served by the involvement of all the regional provincial unions, and that is what we've managed to achieve."

Each of the provincial unions will make a capital contribution to the Crusaders Limited Partnership (totalling $200,000) as well as a loan contribution (totalling $300,000), meaning that the Crusaders Limited Partnership will begin its operation with $500,000 in funds.

Christchurch based-businessman and keen Crusaders supporter Brent Francis is providing a guarantee to satisfy the NZRU that the Crusaders Limited Partnership should be able to meet its ongoing financial commitments during the term of the licence.

"I am thrilled to be involved in the new Crusaders limited partnership," said Francis. "As a Crusaders fan, I am happy to be able to help ensure the future viability of this great rugby organisation.

He will be one of the six directors on the new Crusaders (GP) Ltd board. The other directors will be two nominated by the CRFU, one nominated by the other five unions and two independents.

"We are confident the injection of new capital, stronger governance and fresh thinking will improve the performance of both the Crusaders and the Hurricanes and that will be good for rugby," said Tew.

"We remain confident of a bid being submitted for the Blues to allow a licence to be issued in 2014 and are also hopeful of a bid for the Chiefs."


Key elements of agreement with Crusaders Limited Partnership (CLP)

The licence applies from 1 January 2013 and will expire on 31 August 2020.

The CLP will have one general partner - an incorporated company called Crusaders (GP) Limited - and six limited partners, being the six provincial unions.

The Board of Crusaders (GP) Ltd consists of six directors - two will be nominated by the CRFU, one nominated by the other five unions, two independents and private investor Brent Francis.

All directors will be appointed by an appointments committee made up of one CRFU representative, one NZRU representative and one independent.

The Chief Executive will be appointed by the board.

Each union will make a capital contribution (totalling $200,000) as well as a loan contribution (totalling $300,000), meaning that CLP will begin its operation with $500,000 in funds.

The approximate contributions of the six provincial unions to the capital and loan payments are :

Canterbury 60 per cent
Tasman 18 per cent
South Canterbury 11 per cent
Mid Canterbury 5 per cent
Buller 3 per cent
West Coast 3 per cent

Background on Investec Super Rugby Franchise Licences

The five Super Rugby franchises are owned by the NZRU and are currently run by boards representing the provincial unions that make up each Super Rugby catchment. Reviews into the financial sustainability and structure of Super Rugby and franchises identified the need to reinvigorate the franchise model and provide for additional investment to improve its financial sustainability.

Expressions of interest were called for in December 2011 for four of the five licences. The Highlanders were not part of the process.

A Super Rugby Licensee's responsibilities will include:

management of the team both on-field and off-field including, the professional development for members of the squad
marketing promotion of matches and the team

the Licensee will retain predominantly gate and some sponsorship income and pay administration, additional coaching and management staff, training facilities, match operations, and marketing costs.

The NZRU will:

retain ownership of the brands associated with each team
continue to fund player and coach contracts from centralised broadcasting and sponsorship revenue.

continue to pay all travel and accommodation costs associated with the regular season (excluding playoffs) through SANZAR