Club rugby union is set for a private-equity-led shake-up later this year when the United Rugby Championship replaces the Pro14.
Four South African teams will join the dozen Irish, Welsh, Scottish and Italian sides already part of the Pro14 to form a new 16-team tournament.
The changes, which will incorporate lucrative new TV deals and see South African clubs qualify for European club competitions such as the Champions Cup for the first time, follow CVC Capital Partners’ investment in the competition.
“Forming the United Rugby Championship will begin to reshape the world of club rugby,” said chief executive Martin Anayi.
“North and south will now collide on a regular basis and we cannot wait to see who will rise up as the first champions.”
Sharks, Stormers, Lions and Bulls are the South African teams to have agreed to join the United Rugby Championship, which starts in September.
How United Rugby Championship will work
The 16 teams will be split into four regional pools but will play every other side at least once and be ranked in one single table.
The top eight will progress to knockout rounds and qualify for the following season’s Champions Cup.
Fewer matches will be played on international weekends to ensure that teams are not forced to play without their stars.
“This is a watershed moment,” said SA Rugby chief executive Jurie Roux.
“South African rugby has for many years imagined a future aligned with northern hemisphere rugby and this announcement marks the arrival of that vision.”
CVC, which previously majority owned Formula 1, has made several rugby investments in recents years, including in the Six Nations and England’s Premiership.
It is believed to see value in bringing together the sport’s various stakeholder and overhauling the commercial operations to unlock value from broadcasters and sponsors.
The United Rugby Championship is reported to have agreed TV deals with the BBC in the UK, RTE in Ireland and SuperSport in South Africa that will more than double revenue to £55m.
United Rugby Championship Pools
Irish: Connacht, Leinster, Munster, Ulster
Welsh: Dragons, Cardiff Rugby, Ospreys, Scarlets
South African: Cell C Sharks, DHL Stormers, Emirates Lions and Vodacom Bulls
Italian and Scottish: Benetton Rugby, Edinburgh, Glasgow Warriors, Zebre Rugby Club