There is still a long way to go in the current and disjointed United Rugby Championship (URC) season, which means making predictions is folly. But one trend has caught the eye, and that is how the Stormers have risen from rabble to South Africa’s leading team in the competition.

The Cape Town-based side are on a four-match unbeaten streak, are the leading SA team in the URC and are playing some increasingly sparkling rugby with very few elite stars. They appear to be the best-equipped local team to make a run on the play-offs.

A few months ago, they were struggling to win games and their style was staccato and confused. But they have turned things around with some astute acquisitions of so-called “journeymen” players such as prop Brok Harris and flank Deon Fourie, among others.

They were skimming along almost unnoticed as a rugby team because for the better part of 2020 and 2021 the major story at the Western Province Rugby Football Union (WPRFU) was how its “leaders” were running the organisation into the ground.

It became so bad that SA Rugby was forced to step in, exercising clause 29.1 of its constitution, to take over the running of the union after a series of disastrous decisions, principally about the sale of development rights to Newlands Stadium.

“The fact that I’m present and engaged with the team, and not distracted, has had a positive impact on the players,” Stormers coach John Dobson told DM168. “I’m not trying to say we’ve improved simply because of my coaching but it’s about the fact that players feel more settled.

“They’re not worrying about the union and their future, which must have filtered down at some stage,” he said.

“If I go back to late 2019, I’ve had eight bosses. At executive level it was a series of CEOs, or acting CEOs. There was Paul Zacks, André van der Veen, Peter Jooste, Ronald Bantom and Reuben Riffel. I also reported to the board chairperson, Jan van der Merwe, and later to Ebrahim Rasool, and above that I also had to deal with the president, Zelt Marais.”

Dobson plays down his role in appeasing the dressing room while trying to balance relations with the board and sponsors. But everyone was unhappy, from lead sponsor DHL to players and agents. And Dobson was in the middle, wearing the official cap of coach, but operating as a de facto director of rugby, chief operating officer and commercial director.

During the turmoil the Stormers and the union suffered deep reputational damage that manifested in unpleasant ways. They were unable to hang on to Bok skipper Siya Kolisi and World Cup winners Bongi Mbonambi and Pieter-Steph du Toit. They simply didn’t, and don’t, have the budget to compete, but they also couldn’t guarantee that the entire union wouldn’t collapse in financial ruin.

“We have had situations recently where we have had to field 22 players in away matches (instead of 23) because we suffered an injury in the warm-up but didn’t have the budget to travel with 25 players,” Dobson said.

“That frustrates the players a lot, especially when the Bulls arrive with 30-odd players. But it’s a frustration that comes from a better place, if that makes sense. They don’t view it as a sign that [the] union is sinking, but rather as a sign that it is being fixed and these are the sacrifices that need to be made. In a way it has made us tighter as a squad.”  

Warrick Gelant of the DHL Stormers gets the pass through to Hacjivah Dayimani of the DHL Stormers during the United Rugby Championship match at Emirates Airline Park on 12 February 2022 in Johannesburg, South Africa. (Photo by Gordon Arons/Gallo Images)

Fall from grace

Until recently, the WPRFU had traditionally been at the centre of South African rugby, producing the most Springbok players and having the largest fan base. It was also the richest union, which included not only strong cash reserves but also a deep property portfolio.

Now those 11 properties in their portfolio are bonded to Flyt Property Investment after the union, under Marais’s presidency, botched the Newlands deal.

A company called Dream World, under which Flyt falls, paid more than R52.97-million to Investec Bank on 21 August 2020, and on the same day paid R57.76-million to Remgro to clear the WPRFU’s debts.

As security for the loan, 11 properties owned by the WPRFU were registered with Dream World. According to subsequent court papers lodged by Dream World at the Western Cape High Court in March 2021, the WPRFU “acknowledged that it was indebted to Dream World in the sum of R250-million”.  

Flyt fulfilled its end of the deal by loaning the WPRFU R113-million to cover existing debts. But the relationship between Flyt and WP turned sour when the union tried to backtrack on the agreed asking valuation of the Newlands precinct.

Marais attempted to bring in new investors to oust Flyt, adding more confusion and angst to an already disastrous situation.

The upshot was that Flyt Property Investment lodged a suit against the WPRFU and its trustees for R388-million in damages. It also claimed back its loans of more than R113-million, according to court papers lodged in 2021. 

Slowly putting the pieces back together

Under administration, which is being overseen by former SA Rugby chief executive Rian Oberholzer, the union now has no voting rights at national level. That means it has no say in shaping the future of the South African game at a time when deals to enter the Springboks into the Six Nations and to sell a minority stake of SA Rugby to private equity firm CVC are close to finalisation.

It has been a spectacular fall from grace for a once-great union, although after four months in administration there is stability, which is reflected on the field.

According to several sources, Oberholzer has managed to parlay a deal with Flyt, which is now willing to step back to allow Newlands to be auctioned off in a “sealed bidding process”. Flyt has agreed to settle for an undisclosed amount if a buyer for Newlands can be found during this bidding process.

“This is the cleanest, fairest and most transparent method by which to hopefully secure the sale of Newlands to assist in the long-term sustainability of the Union,” an SA Rugby spokesperson said.

“We are now in a position where we can proceed to a sale, having taken some time to understand … the … sale conversations that [have] taken place.”

The spokesperson said that the sealed bid process was the most transparent method to ensure the best possible outcome for the WPRFU and the prospective purchaser. The process allows parties to submit several bids offering different structures along a set of guidelines issued by the seller, which is the WPRFU under Oberholzer’s administration.

It also prevents any opportunity for the buying party to influence the seller; information is shared simultaneously with all parties and is coordinated externally.

The deadline for the submission of nonbinding offers is 15 April 2022, with submission of final binding offers on 31 May 2022. It is hoped that a sale can be concluded by 7 June 2022.

The fly in the ointment, though, is that, once a bid has been accepted, it has to go back to the WPRFU general council for ratification. The council was a body that was complicit in driving the WPRFU to the brink of insolvency and into administration in the first place.  

It will have one last chance to salvage the union when the bidding process is over because a settlement with Flyt and the sale of the development rights to Newlands is the gateway to the future.

According to well-placed sources, there are two heavyweight private equity parties willing to spend more than R130-million to buy a majority stake in the union. But they will only come to the table when the Newlands Stadium issue, and all the WPRFU’s legal issues, have been resolved.

The Stormers are doing their part on the field, but the question is whether the clubs will do the right thing when the time comes to ensure the union survives. DM168

This story first appeared in our weekly Daily Maverick 168 newspaper which is available for R25 at Pick n Pay, Exclusive Books and airport bookstores. For your nearest stockist, please click here.