Rugby private equity plan

Since the retirements of Roger Federer and Serena Williams, tennis has been hoping for some new stars to emerge to help capture the imagination of fans around the world. An unexpected new name made headlines this week: Lance Davis.

He's not some teenage sensation. In fact, he's not even a tennis player. He is the founder of Killer Bee Live Removal, a pest control company in Palm Desert, California. It was Davis who was saved this week when a swarm of bees forced a halt in play in the quarter-finals of the ATP Championships in Indian Wells – but not before world number two Carlos Alcaraz was stung on the head.

“I was really happy to be there to help everyone not get hurt,” Davis, who removed the bees with his bare hands, told ATPTour.com.

This week in the scoreboard we look at the growing influence of private equity in world rugby. Plus we show how Adidas' “chaotic” boss helped turn the company around. Continue reading – Josh Noble, Sports Editor

Project Amplify: CVC shapes the future of rugby

Nick Clary had been at CVC Capital Partners for just three years when the private equity firm's co-founder, Donald McKenzie, returned from lunch with Formula One boss Bernie Ecclestone determined to buy the sport.

F1 was one of the most successful CVC deals ever. Beyond generating attractive returns, Formula 1 has demonstrated the potential for private equity investment in the sport. Institutional investors have followed suit, pouring billions into the sector, which is increasingly merging with media and entertainment.

Since exiting Formula 1, which was acquired by US group Liberty Media in an $8 billion deal, Clary has continued to lead CVC across a range of sports.

Rugby has been one of the company's biggest bets. The European buyout firm has invested at least £700m in the sport, investing a 27 per cent stake in Premiership Rugby for £225m in 2018, and a 28 per cent stake in United Rugby for £120m in May 2020, and a 14.3 per cent stake from six countries for £365m in 2021.

However, rugby is a sport steeped in tradition. It has a long history of resisting change. After all, the sport waited until 1995 to turn professional.

More recently, the coronavirus pandemic has raised existential questions for the sport. Survive occupied powers rugby. CVC's capital has helped shore up balance sheets, but senior figures in the sport say it is time to push ahead with structural change and prepare the game for the future.

As we covered in the Financial Times this week, changes to the calendar to reduce match clashes are underway, and new competitions are also coming to the sport, in a move to increase audiences and revenues.

The CVC aims to unify rugby's complex structure of governing bodies, associations, competitions and clubs.

Under a plan dubbed Project Amplify, the Premier League, URC and Premier League could be at the forefront of efforts to create a single management team to handle media rights and other commercial deals.

“This set of steps will result in a better product for players, fans and commercial partners, and more revenue to reinvest back into the game,” Clary told the Financial Times. “This is the direction of travel.”

In theory, such a body would have greater negotiating power when sitting down with broadcasters and commercial partners. But it's important to note that CVC's rugby investments are all minority stakes, so it cannot simply impose its will.

Whether Clarry and CVC can bring rugby together is one of the big questions facing rugby as it tries to get on top.

The man – and the shoe – are getting adidas back on track

It has been up to 18 months since Adidas abandoned its partnership with Kanye West due to the rapper's anti-Semitic statements. Canning the Yeezy brand partnership has increased pressure on the company, which is already struggling with weak sales in China and the cost of leaving Russia. The German company's shares took a hit while Yeezy's loss saw sales halved.

But now, it looks like the sportswear brand has moved on. The Chinese market is continuing to rebound, while profits this year are expected to nearly double from 2023, the company said this week. Shares have risen 46 percent in the past 12 months.

The man at the heart of this remarkable recovery story is Björn Gölden, the former Norwegian footballer who became CEO at the start of last year. How did the 'chaotic' former Puma boss turn things around?

First, he ordered a rapid increase in production of two popular shoes – the Gazelle and the Sambas. He told the Financial Times that the old sneakers were “cool” and the company needed to make more of them quickly.

Second, he found a way to deal with Yeezy's hangover: €500 million in stock that Adidas couldn't sell or destroy without facing another torrent of bad press. The solution was to allow customers to purchase Yeezy gear with some of the proceeds donated to charity — those on Adidas mailing lists may have noticed some marketing for the brand this month.

Another major step was to overhaul the company's relationship with retailers. Like its main competitor Nike, Adidas has focused on growing its direct-to-consumer business, much to the frustration of its longtime distributors. But also, like Nike, the German company has realized that the high margins it offers by cutting out the middleman do not make up for the damage it does to its retail network, where two-thirds of sales come from.

But things are not rosy for Adidas. The US market is expected to be a drag for the company this year, partly due to large amounts of unsold stock.

But compared to Nike, which is in the midst of a $2 billion cost-cutting campaign, Adidas appears to have gained a lead over its larger rival.

Highlights

The San Diego Wave, a National Women's Soccer League franchise, has been sold to private equity firm Levin Lichtman Capital Partners for $113 million, nearly double the previous record for a US women's soccer team, Sportico reported.

The Financial Times reported this week that the Bermudian financial structure used by the Miami-based bidder for Everton Football Club to funnel money invested for widows and orphans into the sport has begun to crumble.

Italian financial police raided the headquarters of Serie A club AC Milan on Tuesday as part of an investigation into possible irregularities over its 2022 sale by US hedge fund Elliott Management to private equity group Red Bird.

Market transfer

Michael Edwards (left) has returned to Liverpool FC. The 44-year-old will return to Anfield with a new job title, which is chief football officer at Fenway Sports Group, which owns Liverpool. Edwards spent a decade at Liverpool before leaving in 2022, and will return as the club searches for a replacement for Jurgen Klopp. The German is scheduled to leave his position as team coach in the summer.

Final whistle

Do you miss the good old days when football matches at this time of year were played in thick slush? Well, Croatia Level 2 might be for you.

Here are the final moments of last weekend's match between NK Croatia Zmijavci and league leaders Zrinski Jurjevac. We won't spoil the ending