- WPRFU council votes in favour of forming a partnership with Flyt Property Investment
- Union will receive a loan of R112 million that it must pay back within four years, while it will also receive 50% of any profits generated from the Newlands development
- WPRFU president Zelt Marais believes the deal will "allow the union to unlock the value in its properties, so it can invest in the long-term development of clubs and players in the province"
The Western Province Rugby Football Union (WPRFU) council on Tuesday night voted in favour its a partnership with Flyt Property Investment.
The deal will now need to be ratified at a special general meeting on 8 July that would see it all the way over the line.
WP now stands to receive a loan of R112 million from Dream World Investments - a company within the Flyt group - that would be used by the union to pay off its outstanding debts to Remgro and Investec.
Flyt and the WPRFU would also then be joint owners of a new company called Newlands DevCo that would be equally invested in the redevelopment of Newlands rugby stadium and any profits that come from that project, which is expected to take between three and four years to complete.
WPRFU president Zelt Marais believes the deal will leave the union in a stronger financial position than was the case in their previous deal with Investec, where WP was set to hold just a 5% share in any profits generated from the Newlands development.
Investec had already paid the WPRFU around R50 million of the R110 million that was agreed on between the parties in a deal for the rights to develop Newlands, while the union also owes Remgro a reported R58 million.
The WPRFU must pay back the R112 million loan within four years. Failure to do so will place R250 million of its property assets at risk, which the union has put up as security for the deal.
"As the President of WPRFU, I have always acted in the best interests of the union, its members and the broader rugby community," Marais said.
"This agreement will allow the union to unlock the value in its properties, so it can invest in the long-term development of clubs and players in the province. This bodes well for the sustainability of Western Province rugby.
"We look forward to working with our development partners, Flyt Property Group. Flyt has an excellent track record in the design, development and management of residential, hospitality, industrial and commercial projects. It has a strong balance sheet, with projects being financed by shareholders’ own capital and it is not reliant on bank funding.
"This is the beginning of an exciting new era for rugby in the Western Cape. Rugby fans will soon be able to enjoy world class facilities including a better viewing experience, top notch safety and security measures and modern corporate hospitality suites at the Cape Town Stadium.
"Of course, Newlands will always have its place in the history of the sport and we will certainly pay tribute to our heritage at our new home in the heart of Cape Town.
"I would like thank all our members and stakeholders for their unwavering support in uncertain times, and I look forward to taking the next step of this exciting journey with them. Together, we will continue to build and develop rugby in the Western Cape, especially in our most disadvantaged communities, towards finding future champions."
- Compiled by Lloyd Burnard