Sell all the RFU's assets to the highest bidder

Under another thread in Clubhouse Chat I posted a reply to Richard Lowther setting out how I would engage with all 2,000 Community Clubs to prompt action to cleanse the 'rotten borough' that is the RFU. I have reproduced my post in italics below:

I believe that it is time to uncouple the 10 Premiership Clubs and the rest of the elite game from the 2,000 or so other Community Clubs. All 2,000 Community clubs own the RFU but most of the RFU's resources are directed to the elite game and the 10 Premiership clubs.

The interests of the 10 Premiership shareholders and the elite game are vastly different and the RFU is no longer looking after the majority but only the tiny minority.

Dissolve the RFU by selling all its assets and distributing the proceeds proportionately. The numbers and rationale make perfect sense

In any corporate situation where the interests of the shareholders were so diverse......a sale of the assets or the body corporate would be an obvious solution. It is radical but having considered most of the other scenarios I have concluded that any other course of action would just be tinkering and would not address the fundamental issue.

My concern if this radical course of action isn't undertaken is that the 2,000 or so Community Clubs will only see a few crumbs from King Billy's table as most of the resources are syphoned off to the Premiership and CVC. This way each Community Club will get its fair share of the RFU's net assets which will be an equitable outcome.

This would go to a vote of the clubs at an AGM or a Special General Meeting....two thirds would need to approve so checks and balances in place 

The other issue is that the armed forces regiments and Oxford/Cambridge are also members.

It would cause chaos in the players market as the community game is levelled with equally funded player salaries and then has clubs going under once they've spent their pot of gold.

Bonus is freedom from RFU and CVC. Perhaps also implementation of transfer fees up into good ship CVC

Having said all this, it's a great idea.

What is happening at the moment is that 10 Premiership Clubs are getting the majority of RFU resources and will almost certainly continue to do so at the expense of the Community Clubs......who are likely to get nothing or virtually nothing from the RFU ......ever!

Each club (Community or Premiership) have a single share in the RFU......there will be perceived winners and losers amongst the Community Clubs as they will all get the same payout....but it is likely to measure in the £ hundreds of thousands for each club.

The Rules of the RFU and its ownership will proscribe how the proceeds will be divided.....and it will be almost certainly proportionate to shareholding.......just as it should be, not just 10 shareholders scooping up the majority of the resources.

I have no regard for the Premiership clubs, they are owned by very,very rich individuals and have received most of the RFU's money for the last 20 years.......if it is such a great business and such a great investment CVC can bankroll them and let the Community Game get on with what the RFU should have been all about.

Just to provide a little context I am a Chartered Accountant and a Corporate Financier.....I have been advising on and managing such transactions for the last 30 years... generally in the £10s of millions not the £100s of millions (except for one international deal which was of such a size as this transaction could be ).

Big deals such as this are made to work because :

i) It makes real sense for such a transaction as each group of shareholders are freed up to pursue their differing strategic objectives

ii) There is enough in it to galvanise and motivate a very substantial number of small shareholders

iii) the fees  for the lawyers, corporate financiers and accountants are very big and the best firms want to get involved.

Trust me Berksrugby...this could happen!

As the other poster pointed out quite rightly, several 100's of clubs would take the handout and run, with their clubs going under a short time later when the freebie ran out, mismanaged by clubmen who, although well intentioned, on the whole would squander such an amount of capital chasing short term glory. In no small part, unlike yourself as an accountant and numbers man, because they lack a grasp of financial common sense and business acumen.

I'm talking about the sorts of chairman, treasurers, presidents that harbour aspirations of elevating their club 'up the ladder' to fulfil their dreams and, in some cases, massage their egos in the community - I've seen it before, and it can have long lasting negative effects on players, coaches, and the whole fabric of a rugby club.

Like was also mentioned by someone, your idea would erode the actual community game (which in the truest sense is actually some way below the Championship), and in 5 to 10 years time you would have yet more land (formerly pitches 1 - 3 at 'Old Farts RFC') sold off to property developers to build more houses/flats that no one asked for.

This is not a realistic and progressive vision for rugby union in England that I can entertain, if only for the sake of the fact that I would like my grandchildren to actually still have a local club in existence to play at in the next few years.

Have you taken leave of your senses rugbychris? Then again, who isn't partial to a free handout now and then.

Berksrugby,

Your arguments do not stand up to scrutiny when you compare it to the status quo:

1. The Community game is currently dying on its feet as many 'sides' fold for lack of numbers. How many clubs now run 4 senior sides as used to be the case 20 or so years ago. I  don't know of many in the North West and I expect it to be the same across the country

2. Currently an unelected RFU board led by an unelected King Billy direct virtually all of the RFU's resources (which are effectively owned by the 2,000 rugby clubs throughout England) to a very tiny majority (about 0.05%)

3. You rubbish the character of progressive club Chairmen, Treasurers  and Presidents painting them as charlatans who will waste the resources provided to their clubs by the dissolution of the RFU. How patronising. 

The Community game is withering on the vine and is being starved of investment by King Billy and his courtiers. Far better to distribute the resources fairly and proportionately whilst there are still resources available and let the Community game reset itself under new leadership solely focussed on the Community game

4. I believe in the right of the clubs to democratically decide how to utilise the RFU's resources rather than let King Billy and his unelected board direct all of the RFU's resources towards the elite game and just 10 clubs

For those who say how outrageous to suggest selling off the family silver, you are mistaken. The family silver is producing no return for the circa 2,000 Community clubs. The returns are going to the elite game and the Premiership and to pay King Billy's salary.

Let CVC buy Twickenham and the rest of the RFU's assets (If they are the highest bidder) and return the proceeds to the 99.9% of shareholders being the Community clubs. Twickenham and its returns can then provide for the Elite game and the Premiership and the Community Game can provide for itself.

Is this a more outrageous idea then letting King Billy and his unelected courtiers reign over the dissolution of English Club rugby by stealth?

Camquin,

Please see my replies to your points in red below

Kind Regards

Big Eddie

Berksrugby,

My answer to your derisory snort is in red below.

Why is it madness? I can give you plenty of examples where large corporate entities have undertaken a transaction/demerger/Management buyout etc to resolve a fundamental shareholder issue.

This is one of these cases.

The Community Game gets very little from the RFU. The whole structure of the RFU is devoted to satisfying the needs of the Professional and the Elite Game and of course keeping King Billy and his acolytes in hugely well remunerated employment.

1) Toughen up. In the 50+ years I have been following rugby, I have come to expect and enjoy the company of those who can handle a difference of opinion without throwing their toys out the pram or crying into their pillow if someone disagrees with them. Leave the Snowflakes to follow other sports with different shaped balls.

2) When I see or hear someone (online or in the flesh) attempting to stir up an idea, ideology, revolution so far detached from reality and (in this case) what the ordinary player/fan enjoys and is content with on their Saturday afternoon, I have always stood up and challenged said propaganda. Who do you think you are talking on behalf of, aside from 6 or 7 semi pro Championship clubs?

3) Please stop referring to the Championship as 'Community rugby'. It is simply not the case. Whilst some of the clubs trying to keep their head afloat in the Championship may once have been true community clubs, those days are gone. Community rugby starts at National 1 and below, as evidenced by the tackle height law changes not affecting the top 2 tiers, which are exempt.

Any league that houses fully pro sides like ET, Donny etc, can't be considered to be playing Community rugby.

4) I have had sight of the '3 polls' you created in a thinly veiled attempt to service your own agenda as a supporter of a club set to miss out when Premiership 2 is borne and semi pro clubs are removed. Quite frankly, they make laughable reading. The number of responses (or distinct lack of) should be all the evidence that you need to finally realise that, not only are you fighting a losing battle, but in all truth, no battle at all. It is viewed as a non-issue by the considerable masses that play and support rugby in this country. Several posters have pointed this out to you in different ways, yet you don't seem to be getting the message. To paraphrase, I think it was Einstein that coined the phrase about madness being the preserve of those who do the same thing again and again, expecting a different result. You would do well to take heed of this.

5) I am not a numbers man, of that I freely admit. You can examine the RFU administrative documents all you like with your background in finances, and then highlight the fine grain detail that fits your agenda to try and justify your discontent and coup d'etat against the RFU; but when all is said and done, it won't make a blind bit of difference. In 6 -12 months time, tell me I'm wrong.

There is nothing more I can add, other than to wish you well, in the hope that you can move on from this slightly unhealthy preoccupation of fighting a battle that isn't there to be fought, and to be at peace with yourself.

Dear Berksrugby,

Thank you for the enhanced moniker, as a Liverpool supporter it works rather well and I appreciate your response. I have set out my responses in red under the points you have raised.