The Western Bears bid is dead: NRL severs ties with consortium after ‘low-ball’ proposal

The NRL has informed the Western Australian government that they refuse to consider or work with the consortium behind the Western Bears bid in a major hurdle to the game’s expansion plans.
NRL officials are privately fuming over what sources with knowledge of the situation talking under the condition of anonymity due to confidentiality told this masthead was a perceived attempt from the consortium to “low-ball” the NRL in the business proposal they recently submitted.
NRL bosses Andrew Abdo and Peter V’landys.

NRL bosses Andrew Abdo and Peter V’landys.Credit:Nick Moir
The NRL now wants to work directly with the WA government to formulate a potential ownership model that doesn’t involve the Western Bears consortium.
The NRL have since informed the Western Australian government that the bid, run by Cash Converters deputy chairman Peter Cumins, was now out of the running for one of three potential new licenses head office is looking at handing out in their push towards a 20-team competition.

This masthead recently reported that colourful Sydney Kings part-owner Paul Smith and former NRL executive Paul Kind, who run Total Sport and Entertainment, were in secret negotiations with the consortium. Their inclusion as owners in the proposal blindsided the NRL.
The NRL expansion submission also included a question about potential licence fees that bids would be willing to pay. The Western Bears consortium indicated they wouldn’t stump up a licence fee.
Bears fans Craig Gray and Josh Averell at North Sydney Oval in excitement for a potential marriage with a Perth team.

Bears fans Craig Gray and Josh Averell at North Sydney Oval in excitement for a potential marriage with a Perth team.Credit:Steven Seiwert
Cumins has not responded to attempts to contact him for comment. The NRL declined to comment.
The NRL has been clear that a prerequisite for a team in Perth will be a link with the North Sydney Bears, and that won’t change under new negotiations with government.

Advertisement

They have informed North Sydney officials that their decision to cut ties with the consortium will not impact on their hopes of returning to the competition, should a Perth team be introduced in the competition from as early as 2027.
ARLC chairman Peter V’landys hinted at the drama in an interview on radio on Sunday when asked about the nine expansion proposals that were submitted to the NRL.
“Look, we have run into a bit of a hiccup at the moment in relation to the bids weren’t as good as we hoped they would be, except for the Papua New Guinea bid,” V’landys said on Triple M just hours out from Sunday’s NRL grand final.
“That was exactly like we expected but the others weren’t. That has probably slowed us up a bit but we will certainly be looking nevertheless in trying to expand in the next few years because we need to have our content right when we go to the broadcasters to get our maximum broadcast deal.”
The Western Bears consortium recently agreed to a partnership with the North Sydney Bears that included the use of the red and black colours with gold to represent WA, the use of the Bears name as well as the potential for one North Sydney director to sit on the NRL club board.
The consortium was originally reluctant to partner the Bears but begrudgingly agreed to a partnership deal after the NRL highlighted they wouldn’t budge on the Bears being a prerequisite for a license.
 
Well that's the thing, the NRL didn't ask for a guarantee...they asked for a fee. Very different things.

A guarantee would be monies held on deposit on behalf of the Bears in case of financial disaster. I doubt anyone would be against this. In fact it's not a bad idea. The fee is the problem because it's just an extra 20 million handed over to the NRL. Big difference.
Once again, the mooted bid will receive $30,000,000.00 minimum in the first two years of their operation as two separate NRL grants.

Anyone who can’t come up with $20,000,000.00 when they’ll get it back plus 50% within two years, PVL says don’t bother coming to the table.

Obviously I don’t know the minutiae but that makes sense to me, good way to weed out any rich buggers who might just like the sound of owning an NRL team, without any risk.
 
Once again, the mooted bid will receive $30,000,000.00 minimum in the first two years of their operation as two separate NRL grants.

Anyone who can’t come up with $20,000,000.00 when they’ll get it back plus 50% within two years, PVL says don’t bother coming to the table.

Obviously I don’t know the minutiae but that makes sense to me, good way to weed out any rich buggers who might just like the sound of owning an NRL team, without any risk.
They've already come up with $30mill for the bid, asking for an extra $20mill seems a bridge too far. He won't get it from anyone else so he's painted himself into a corner in regards to his 20 team comp.
 
Once again, the mooted bid will receive $30,000,000.00 minimum in the first two years of their operation as two separate NRL grants.

Anyone who can’t come up with $20,000,000.00 when they’ll get it back plus 50% within two years, PVL says don’t bother coming to the table.

Obviously I don’t know the minutiae but that makes sense to me, good way to weed out any rich buggers who might just like the sound of owning an NRL team, without any risk.
15 million a year pays salaries for players and junior development like all clubs.

They don't get it back because they still have to cover salaries. What you're saying is the new franchise should have to cover a portion of the first 2 years of their player salaries when all other clubs get the grant no questions asked.

But if you insist on viewing it as them getting the money back +50%, why wouldn't the NRL allow the funds to be in the form of an Interest bearing deposit? Why take it as a non-interest bearing fee and give it back?

This is not how businesses do these deals. They are done with guarantees in the form of bonds or deposits if there is some conjecture about the financial viability of the project in the future, usually with some future date where the money can be withdrawn again.

Having to come up with 20 million to hand over, then come up with even more to fund club operations puts a business on the backfoot straight away. That's a lot of capital to just hand over.

Anyway, I've said my piece. Just saying from many years of experience in mergers and acquisitions, this is simply not how it's done and frankly it looks more like PVL intentionally killed the deal.

If you think it's a great deal, I've got a bridge for sale if you're interested?
 
15 million a year pays salaries for players and junior development like all clubs.

They don't get it back because they still have to cover salaries. What you're saying is the new franchise should have to cover a portion of the first 2 years of their player salaries when all other clubs get the grant no questions asked.

But if you insist on viewing it as them getting the money back +50%, why wouldn't the NRL allow the funds to be in the form of an Interest bearing deposit? Why take it as a non-interest bearing fee and give it back?

This is not how businesses do these deals. They are done with guarantees in the form of bonds or deposits if there is some conjecture about the financial viability of the project in the future, usually with some future date where the money can be withdrawn again.

Having to come up with 20 million to hand over, then come up with even more to fund club operations puts a business on the backfoot straight away. That's a lot of capital to just hand over.

Anyway, I've said my piece. Just saying from many years of experience in mergers and acquisitions, this is simply not how it's done and frankly it looks more like PVL intentionally killed the deal.

If you think it's a great deal, I've got a bridge for sale if you're interested?
Sounds like you are much more informed than I am on these things, be interested to see what happens next.
 
15 million a year pays salaries for players and junior development like all clubs.

They don't get it back because they still have to cover salaries. What you're saying is the new franchise should have to cover a portion of the first 2 years of their player salaries when all other clubs get the grant no questions asked.

But if you insist on viewing it as them getting the money back +50%, why wouldn't the NRL allow the funds to be in the form of an Interest bearing deposit? Why take it as a non-interest bearing fee and give it back?

This is not how businesses do these deals. They are done with guarantees in the form of bonds or deposits if there is some conjecture about the financial viability of the project in the future, usually with some future date where the money can be withdrawn again.

Having to come up with 20 million to hand over, then come up with even more to fund club operations puts a business on the backfoot straight away. That's a lot of capital to just hand over.

Anyway, I've said my piece. Just saying from many years of experience in mergers and acquisitions, this is simply not how it's done and frankly it looks more like PVL intentionally killed the deal.

If you think it's a great deal, I've got a bridge for sale if you're interested?
It's a bit weird isn't. They're worried about the bids finances so are going to take $20 mill off them to help.
 
You got to ask that if the Dolphins leagues club guaranteed the finances then why can't norths leagues?

They're contributing nothing else bar the logo.

That would be a massive amount of money just to guarantee 1 game a year in Sydney.There is no way Norths Leagues would be crazy enough to do that and if they did they would be sacked at the next club election like they should be
 
That would be a massive amount of money just to guarantee 1 game a year in Sydney.There is no way Norths Leagues would be crazy enough to do that and if they did they would be sacked at the next club election like they should be
The $20 million fee indicates to me PVL is after some heavy hitters to invest in the game. That’s chump change in terms of ownership in other major sports.
 
Back
Top