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Re: Salary cap breaches revealed
Posted by: #wolfpack
Date: 23/01/2020 14:32
Marlow Nick
Marlow Nick
Maro: I want more salary
Nigel: what about if I bought shares in your image rights company
PWC: a 30% stake would be 1.6m
Maro: OK then I want 1.6m for 30%
Nigel: sounds like a fair market price based on the valuation of one of the biggest consultancy firms in the world, one that is trusted by premier rugby.

RECKLESS is being very generous

Fixed it for you

So Nigel (well known for his expertise in property deals) is now an expert in image rights?
You have to admit that even without the dispute about valuations this is sailing very close to the wind and pushing the spirit of the salary cap to breaking point
One of your highest profile players wants a pay rise. Low and behold Nigel decides to get into the image rights business and suddenly the player has 1.6M in their bank account. Maybe it was worth 1.6M, maybe it was worth 0.8M but either way surely this shouldn't be a transaction with a connected party.

I hope this sort of dodgy deal is explicitly banned in the next version of the cap rules. Nothing to stop Itoje selling his image rights - but not to any individual or company with any links to the club.

2 points -
1. Read the discussion between myself and stevene on this. It might help explain what actually happened and what the panel's judgment is based on.
2. Your post could very well start with "so the Salary Cap Manager (well known for his expertise in property deals) is now an expert in image rights?"

The whole point here is not that Saracens deliberately or even recklessly or whatever word you want overvalued the image rights at all. As per my earlier post - the panel specifically says that there "is force" in Saracens' rejections that the image rights were overvalued to account for lower pay, but it doesn't give an opinion because "it is not necessary to do so" (that is a quote - read the report).

The whole point is Saracens had to prove that the Salary Cap Manager had been unreasonable in relying on an alternative report. It did NOT say Saracens had tried to circumvent the salary cap at all. It did NOT say PWC (PRL's own auditors) were wrong. It did NOT say that the investors' price was inflated. It said that the SCM was reasonable in his opinion based on a different valuation.

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