Financial plan spells promise of progress

Bond scheme could raise £400m to stabilise professional clubs and help bridge the divide between the hemispheres

Peace in our time? Not quite, not yet. But money in our time is no bad substitute, especially when the bucks are big enough to make the markets sit up and take notice. The movers and shakers of northern hemisphere rugby have yet to consider the full implications of the £250m securitisation package proposed by Dr Tony O'Reilly in Rome over the weekend - "Nothing has been ruled in, and nothing ruled out," said Roger Pickering, the chief executive of the Six Nations, in his best politician-ese yesterday - but there is an almost tangible mood of bullish anticipation about the bruised and battered old game as a result of this latest initiative.

Peace in our time? Not quite, not yet. But money in our time is no bad substitute, especially when the bucks are big enough to make the markets sit up and take notice. The movers and shakers of northern hemisphere rugby have yet to consider the full implications of the £250m securitisation package proposed by Dr Tony O'Reilly in Rome over the weekend - "Nothing has been ruled in, and nothing ruled out," said Roger Pickering, the chief executive of the Six Nations, in his best politician-ese yesterday - but there is an almost tangible mood of bullish anticipation about the bruised and battered old game as a result of this latest initiative.

Not least because it appears to offer so many factions so much of what they want. The four home unions would get the control they crave - not merely undisputed governance of their respective domestic games from top to bottom, but increased control of their own financial destinies - while those perceived ogres of the sport in England and Wales, the club owners, would at last have an opportunity to drive professional rugby forward in a spirit of enlightened co-operation rather than perpetual confrontation. It would allow the players, the poor bloody infantry, the comfort of knowing that their day jobs were not wholly dependent on the whim of a single millionaire investor, and it would give the suffering supporters a break from the bitching and back-biting that has stained rugby's image and persuaded so many of the disenchanted to vote with their feet.

Under the strategy put forward by Dr O'Reilly, the former Ireland and Lions wing who is chairman of Independent News & Media, publishers of The Independent, the British and Irish unions would emulate Formula One motor racing and a number of leading British and European football clubs by selling bonds secured on future broadcasting, advertising, marketing and sponsorship revenue.

Securitisation specialists at Warburg Dillon Read, one of the world's most successful and influential merchant banking houses, describe the £250m figure as a conservative estimate. When they make their detailed presentation to the Six Nations Committee, probably next month, they are likely to go as high as £400m.

Even at the lower end of the scale, the windfall over 10 years bears comparison with the $550m (£335m) pumped into New Zealand, Australian and South African rugby by Rupert Murdoch in 1995. Murdoch's investment provided the financial bedrock on which the three super-powers created their Super 12 and Tri-Nations tournaments - state-of-the-art competitions that are cited by many envious European coaches as the driving force behind the southern hemisphere's continuing hegemony at international level. Early supporters of the O'Reilly deal see it as a means of financing a similar root and branch restructuring of the professional game in these islands.

And it is becoming transparently clear that in England the restructuring will be along the lines suggested by Rob Andrew at Twickenham last week.

Assuming the great and good of the Six Nations Committee give the Warburg Dillon Read securitisation their pin-striped blessing - having spent the last four years in the financial quicksand, they would need a very good reason not to - the Rugby Football Union would use its slice of the pie to underwrite a new-look Premiership made up of 12 franchised, fully professional and unashamedly élite teams, from Newcastle in the north-east to Bath in the south-west.

There is also increasingly confident talk of a Celtic League involving an as yet unspecified number of Welsh teams, plus the two Scottish "super-clubs", based in Glasgow and Edinburgh, and the four Irish provinces. This would, in the great scheme of things, run parallel to the English Premiership and lead naturally and excitingly into a re-scheduled European season starting in late January or February. One major plank of the Andrew blueprint - the re-positioning of the Six Nations Championship as a blocked-off tournament in April and May - cannot be implemented until the broadcasting rights come up for grabs in the summer of 2002, but the rest of it might well be in place next season.

The securitisation strategy effectively blows Tom Walkinshaw's plan for a British League clean out of the duckpond; given that the chief attraction of the Gloucester owner's challenging vision of club rugby's future was the £85m he insisted was sitting on the table, just waiting to be spent, his thunder has been well and truly stolen. But while Walkinshaw and his fellow hard-liner, Keith Barwell of Northampton, remain suspicious of Andrew's blueprint and are uncertain that the club game can pay its way on as few as 14 big-league home games a season, the common acceptance of the franchise principle offers a clear basis for agreement.

"I think it's fair to say that, while there are a number of political issues left to iron out, there is a widespread willingness to stay positive and hammer out a lasting solution," Pickering said yesterday. "Without hearing precisely what Warburg Dillon Read have to say, it is difficult to assess the full implications of any securitisation. But clearly, their enthusiasm in itself is a massive vote of confidence in rugby. We still have our problems and instabilities, but to have a financial institution saying openly and publicly that the game has real potential is tremendously reassuring. We remain guarded; we are only at the conceptual stage, after all. But if you want me to sum up the Six Nations Committee's first reaction, I can only say it was one of delight."

Four days ago, both Andrew and Francis Baron, the chief executive of the RFU, used such bleak language in describing the parlous financial state of the professional club game in England that they sounded as though they were ready to turn to the Samaritans for advice. That pessimism evaporated during the course of 72 hours in Rome, where the Six Nations Committee had gathered to welcome Italy into the international championship. It seems British and Irish rugby may yet steer clear of a political fight to the death, and establish a prosperous place in the sporting landscape of the 21st century.