News

The Western Province Rugby Football Union has voted to enter into a development agreement with Investec for Newlands Rugby Stadium.

RugbyRocks.com understands it will be based on a 99-year leasehold with an option to renew.

Next year will be WP Rugby's last at the historic 51,900-capacity stadium, which was opened in 1888. It is set to be demolished, with residential and retail properties built on the site.

WP Rugby will be paid R110-million from the deal, with a 5% share in profits from the development and 3.5% of resales of the units. However, no funds are expected from these sources for six years.

As the deal is subject to rezoning approval from the City of Cape Town, the payment will initially be a loan.

R52-million will immediately be paid across to Johann Rupert's Remgro to fully repay its loan. The Stellenbosch-based investment holding company bailed out WP with a personal loan at the end of 2016 when the union faced bankruptcy.

R58-million will be paid to WP Rugby and used to keep the company (professional arm) and union (amateur arm) going until the end of December.

The WP executive has reportedly assured the union that it and the company will run on a break-even budget from then on.

WP Rugby is expected to become an anchor tenant at Cape Town Stadium in Green Point from 2021, although the move has yet to be confirmed.