SRU boss Mark Dodson: We can’t afford pro team inflation

Mark Dodson says he wants permission  from member clubs to seek outside investors in the pro teams because of inflation in the game.
Mark Dodson says he wants permission from member clubs to seek outside investors in the pro teams because of inflation in the game.
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SRU chief executive Mark Dodson has called on member clubs to back the union’s bid to seek outside investment in Scotland’s pro teams and said the search for suitable partners will be a global one.

A Special General Meeting will be held next Friday to debate the motion and Dodson has been convinced that the time is now right for such a move after previously being lukewarm on the concept.

“We’ll look globally. Simple as that,” he said. “There has been no informal approaches but we have been researching the market for some time. Dominic [McKay, SRU chief operating officer] and I have been to the Far East and America.

“We’ve got a very good idea what the market is like and the appetite globally for sports franchises. What we have to do is tailor the package to see if the same people who are interested in investing in sports franchises would be interested in doing so in Scottish rugby.

“We’ve not done anything specific, there is no-one waiting in the wings, but we know that’s what we have to do.”

The last time anything similar was attempted in Scottish rugby was when businessman Bob Carruthers was involved with Edinburgh a decade ago and that ended acrimoniously. However, Dodson is adamant that finding partners to help with the rising costs of running professional clubs is now needed, ideally with the union retaining their controlling interest and maintaining their current level of funding.

Dodson added: “I wasn’t here when the Bob Carruthers deal was done but if we are to take a proposition to market then we have to have the permission of our stakeholders and things enshrined in that agreement that protect the domestic game, the international game and the academy pipeline.

“We’ve not had anybody from Scotland who has been remotely interested in coming in and spending that kind of money. What we had to do is say ‘okay, we will fund ourselves from the union’, and we have done that successfully from 2012 to 2016.

“What we are now saying is that inflation in the game is running at such an extent that we see a limit to our ability to earn the amount of money needed to maintain growth and our ability to stay at the top table. That’s what has prompted us to look for external investment.”

Getting the motion passed next week is the first hurdle to be cleared. McKay said: “The first part is to get a quorum of 106, so roughly 50-plus clubs, on 28 October.

“Then we can have discussions with people from Scotland, North America or the Far East, wherever it might be. Investors have to realise they are part of the ecology of Scottish rugby. We know this is an unbelievably tough sell. But we’ve proved we’re good at working with partners, and there’s now investment going into professional sports franchises of a level we’ve never seen before.

“We’re trying to cap our investment into the pro teams. At the moment you’ve got two per cent inflation in the domestic game and 25 per cent inflation in the professional game, there comes a point where you have to make difficult choices.”

Dodson believes the Guinness Pro12 is a competition that will appeal to foreign investment and added: “We’ve got two big cities with two teams in a league that has no promotion and relegation and can be built out from there. People are clearly buying franchises like this over world, whether it’s Major League Baseball, Major League Soccer or in the English Premier League football where we have just seen four Midlands clubs go to Chinese buyers.

“Having no relegation is a big selling point. If you look at the Aviva Premiership, the biggest drawback for owners is relegation.

“Look at London Irish last year and the challenges of a Bristol, who have got a billionaire owner and are now finding it difficult to cope in that league due to the transition [from the Championship].

“Is it logical to invest money in a bottom-four team when there is the jeopardy of relegation? That’s why the Americans – the most capitalist country in the world – take a socialist view of these things and make sure there is a fixed ecology for long-term investment.”