Red Bull Agrees Deal to Buy Newcastle Falcons, Saving Premiership Club
In a significant development for the rugby union community, Red Bull has agreed to buy Newcastle Falcons, ensuring the Premiership club’s future and maintaining the top-flight competition as a 10-team league. The deal, confirmed by The Guardian, includes a commitment to keep the club in Newcastle and alleviate concerns about its financial struggles.
Newcastle Falcons have been on the market for over a year, with owner Semore Kurdi no longer able to fund the club’s multimillion-pound annual losses. The situation raised fears that the Falcons could become the fourth Premiership club to go bust in two years, following Wasps, Worcester, and London Irish. However, the Guardian reports that Red Bull has reached an agreement to take over the cash-strapped club and assume its £39m debts, including £14.5m in unpaid treasury loans taken out during the Covid-19 pandemic.
The takeover deal is a significant boost for the Premiership, which had considered a nine-team top-flight competition if Newcastle Falcons were to fold. The other Premiership clubs had agreed in principle to provide a £4m loan to enable Newcastle to participate in the competition next season. However, with Red Bull on board, this loan will not be required. According to The Guardian, Red Bull’s vision for the club involves using its brands and marketing expertise to attract younger fans in Newcastle, with several campaigns planned to appeal to the city’s student population.
Newcastle Falcons have a long history in the city, having played at Kingston Park since 1990. The Guardian understands that Red Bull’s takeover plan includes a commitment to keep the club at its current home, dispelling concerns that the team might relocate to the 26,000-capacity Darlington Arena, 40 miles away.
The acquisition of Newcastle Falcons marks Red Bull’s entry into rugby union, but the company’s sports portfolio is no stranger to transformation. Red Bull has successfully turned around the fortunes of various teams, including its Formula One team, Jaguar Racing, which it purchased for just $1 in 2004. The company has since won eight world drivers’ championships and six constructors’ titles in the last 15 years. As The Guardian notes, Red Bull’s purchase model typically involves snapping up underperforming sports teams and turning them into global brands.
Red Bull’s involvement in Newcastle Falcons is also expected to lead to a closer working relationship with Newcastle United, given the company’s footballing connections. The club’s outgoing sporting director, Paul Mitchell, previously worked at RB Leipzig, a football club also owned by Red Bull. According to The Guardian, Red Bull’s decision to stay in Newcastle is likely to be popular with the club’s fans, who have endured a difficult few seasons, including a winless campaign last season.
The takeover is also a significant boost for Premiership Rugby, which has seen a 10% increase in viewing figures for matches on TNT Sport this season. The broadcaster has agreed a new five-year deal giving it exclusive live rights for every Premiership match until 2031, providing much-needed stability and growth for the sport. As reported by The Guardian, Red Bull and Newcastle Falcons have declined to comment on the deal.
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