ACT Brumbies look to secure private equity deal after announcing $1.3 million loss for 2022

Brumbies chairman Matt Nobbs pinned the figure on a significant loss of Rugby Australia funding, adamant there had been no "reckless spending" ahead of the club's annual general meeting on Wednesday night.

Rugby Australia slashed funding for its five Super Rugby clubs by 30 per cent - to the tune of approximately $1.7 million - with the full grant to be reinstated next year.

"It's one of the factors, and then back-to-back COVID years. We were able to absorb that loss in Rugby Australia's funding in the first year with Jobkeeper," Nobbs said.

"We just couldn't absorb it in 2022, that's where the hole is. Add $1.7 million back to it and we're talking about a small profit.

MORE SPORT:

"For 2024 and 2025, there's $8.5 million coming back as an annual payment from New Zealand Rugby to Rugby Australia, and the thinking is that will be split five ways amongst the Super Rugby teams."

Now the Brumbies will forge ahead with private equity talks in the hope of striking a deal within the first half of 2023, with club officials willing to sell up to 49 per cent of the organisation to investors to secure the Super Rugby franchise's financial future.

A number of organisations have signed non-disclosure agreements to assess the deck put together by investment advisory group Freshwater Strategy.

It is understood some potential investors have a history in sport, and officials hope the strength of the Brumbies' brand internationally will encourage investment talks.

"We had to look outside the box as to where we're going to go. We can't afford to have too many of these losses, hence why we've gone down the private equity route," Nobbs said.

"The GWS announcement [the AFL club will receive $28.5 million in ACT government funding over the next 10 years] over the past couple of days makes our negotiations next year even more important in trying to get an uplift in funding from [the ACT government] as well.

"In many ways we've now tried to get ourselves on the front foot so we can get ourselves ahead of the curve. This private equity stuff we're going through, the conversations have exceeded our expectations and we're confident we'll do a deal in probably the first half of next year. The idea is to grow."

A deal to secure Super Rugby Pacific in its current format until 2030 - with Australia, New Zealand, Fiji and Moana Pasifika to push on with a 12-team competition - has allowed the Brumbies to go to the market with confidence about their immediate future as the club hunts for a new front of jersey sponsor, with interest believed to be shown from an overseas party.

We've made it a whole lot easier for you to have your say. Our new comment platform requires only one log-in to access articles and to join the discussion on The Canberra Times website. Find out how to register so you can enjoy civil, friendly and engaging discussions. See our moderation policy here.

Our journalists work hard to provide local, up-to-date news to the community. This is how you can continue to access our trusted content: