Rugby deal makes NZR a Sky shareholder
In a deal that will change the sports media landscape, New Zealand Rugby is to become a 5 percent shareholder in Sky. Mark Jennings reports.
Sky CEO Martin Stewart needed to pull something out of the hat after his company lost first the Rugby World Cup rights and then last week the New Zealand Cricket rights to rival Spark Sport.
He appears to have done it.
This morning New Zealand Rugby (NZR) and Sky announced a new broadcast agreement which extends Sky’s existing SANZAAR broadcast rights to 2025. The five-year agreement includes the rights to broadcast rugby in New Zealand from 2021 to 2025.
This includes exclusive coverage of all Investec Rugby Championship, Steinlager Series, Investec Super Rugby, Mitre 10 Cup and all New Zealand’s other domestic competitions, including women’s competitions like the Farah Palmer Cup.
NZR chief executive Steve Tew said agreement secures the long-term financial health of rugby.
“I would like to thank Martin and his board for the confidence they have shown in NZR with this investment and we look forward to continuing to build our long-standing and deep partnership as we both face the challenges and opportunities that a rapidly-changing broadcast, entertainment and sporting world presents,” said Tew.
The unexpected and innovative part of the deal is NZR's decision to take a 5 percent stake in Sky,
It looks like a “win win” for both parties.
The NZR has long considered how it can get more direct upside from owning New Zealand’s number one brand – The All Blacks.
Doing a Manchester United and developing its own TV channel like the English Premier League club was an option but in a small country like New Zealand it could have been risky. By buying into Sky it gets to leverage the brand without the distraction of entering a new area of business where it lacks expertise.
For Sky, it shores up a future that was starting to look shaky.
Losing first the Rugby World Cup and then New Zealand Cricket to Spark has seen Sky's share price sink to a new low.
CEO Martin Stewart must be a relieved man.
“We are delighted to have secured this superb rugby content for our customers to the end of 2025. Our commitment is to deliver rugby to all New Zealanders in ways that work for them, including streaming, broadcast over our satellite and free-to-air on Prime.
“This partnership with NZR cements our shared commitment to nurture and grow the game across all aspects, from grassroots to high performance, and for women, men, boys’ and girls’ rugby.
“A special part of this deal is the 5 percent equity stake that NZR is taking in Sky. We have long known that there is mutual benefit when each of us succeeds, and we’re pleased that NZR is becoming an investor in Sky.
“Rugby is a core and significant part of our offer as the home of sport. We know it attracts customers to Sky, who then also discover and enjoy the deep range of local and global sport that we offer. Our renewed partnership with NZR brings value to all of our sport partners, and we’re delighted to have them continuing as part of the Sky family,” Martin Stewart said.
Sky will seek formal approval from shareholders to complete the NZR deal when it holds its annual meeting this Thursday, October 17.