Mengniu, twice hit by accusations it sold tainted milk, said
on Wednesday it would buy 26.92 percent of China Modern Dairy
Holdings Ltd from private equity firms KKR & Co LP and
CDH Investments. The deal will lift Mengniu’s stake in China
Modern to about 28 percent.

For Mengniu, whose liquid milk products rank first in China
by sales volume, the purchase is an attempt to ensure control
over its milk supplies and win confidence among consumers in a
market that is growing at about 20 percent a year.

For KKR, the storied New York private equity firm, the deal
is another lucrative transaction following its relatively late
arrival in Asia in 2007. After Modern Dairy’s 2010 IPO and the
current deal, KKR will have almost tripled its original
investment, according to a person with direct knowledge of the
matter.

“It is a deal which benefits all parties, of which the
private equity funds are seen to be the biggest winner,” Sunwah
Kingsway Group Research analyst Steve Chow said.

“Chinese dairy products makers are racing to secure reliable
and high-quality raw milk sources, in particular from overseas.”

Mengniu’s main competitor, Inner Mongolia Yili Industrial
Group, has gone overseas to secure quality milk. It
was granted approval to build an infant milk formula plant in
New Zealand last month.

DISCOUNT MILK

Headquartered in China’s eastern province of Anhui, Modern
Dairy sells almost all its raw milk products to Mengniu.

The HK$2.45 per share purchase price is a 12.1 percent
discount to Modern Dairy’s previous closing price – a rarity in
M&A where acquisitions usually come with a roughly 25 percent
premium.

Modern Dairy’s share price has soared since the end of last
year, from HK$2 to HK$2.79 at Tuesday’s close. Speculation about
talks between Mengniu and Modern Dairy first surfaced in last
August.

“The increase of Mengniu’s stake in Modern Dairy is to
secure both quality and quantity of raw milk sources,” Sun
Yiping, chief executive officer of Mengniu said in a press
release.

Shares in Modern Dairy fell nearly 12 percent to HK$2.46 on
Wednesday, while Mengniu Dairy’s stock rose 1.6 percent. The
Hang Seng index was 0.62 percent higher in intra-day trade.

Standard Chartered said in a research note that part of
KKR’s rationale for accepting a discount was to build a
long-term relationship with COFCO, the state-owned enterprise
which is the top shareholder in China Mengniu.

In addition, KKR has already earned a “quite reasonable”
return on its investment, the bank added.

KKR and China-focused private equity firm CDH bought stakes
in Modern Dairy after the country’s milk industry was battered
by a 2008 scandal involving chemical-laced products. KKR paid
$150 million in cash for a 34.5 percent stake, which it sold
down to 24 percent after Mengniu’s 2010 IPO. CDH paid $50
million for its holding.

Mengniu was one of about 20 companies implicated in that
scandal, when the lacing of milk with the industrial chemical
melamine killed at least six children and sickened nearly
300,000 people. The company now says that enhancing the quality
of its milk supplies is a key focus for management.

Mengniu teamed up with Danish-Swedish dairy group Arla Foods
in June last year to develop dairy products in China,
in another bid to regain consumer confidence.

But late last year Mengniu apologised after a government
quality watchdog found that some of its products contained
aflatoxin, a substance produced by food fungus that can cause
severe liver damage, including liver cancer.

It is not alone in facing quality-control problems. China’s
Bright Dairy & Food Co Ltd recalled batches of sour
milk in September last year after it received hundreds of
customer complaints, while Inner Mongolia Yili Industrial Group
recalled baby formula tainted with “unusual” levels of mercury
in June.

China’s dairy market is still relatively young, with
consumption of dairy products growing at an annual compound rate
of 20 percent, a stark contrast to U.S. and European markets
where demand has been shrinking in the past decade.

Mengniu, twice hit by accusations it sold tainted milk, said on Wednesday it would buy 26.92 percent of China Modern Dairy Holdings Ltd (1117.HK: Quote, Profile, Research, Stock Buzz) from private equity firms KKR & Co LP and CDH Investments. The deal will lift Mengniu’s stake in China Modern to about 28 percent.

For Mengniu, whose liquid milk products rank first in China by sales volume, the purchase is an attempt to ensure control over its milk supplies and win confidence among consumers in a market that is growing at about 20 percent a year.

For KKR, the storied New York private equity firm, the deal is another lucrative transaction following its relatively late arrival in Asia in 2007. After Modern Dairy’s 2010 IPO and the current deal, KKR will have almost tripled its original investment, according to a person with direct knowledge of the matter.

“It is a deal which benefits all parties, of which the private equity funds are seen to be the biggest winner,” Sunwah Kingsway Group Research analyst Steve Chow said.

“Chinese dairy products makers are racing to secure reliable and high-quality raw milk sources, in particular from overseas.”

Mengniu’s main competitor, Inner Mongolia Yili Industrial Group (600887.SS: Quote, Profile, Research, Stock Buzz), has gone overseas to secure quality milk. It was granted approval to build an infant milk formula plant in New Zealand last month.

DISCOUNT MILK

Headquartered in China’s eastern province of Anhui, Modern Dairy sells almost all its raw milk products to Mengniu.

The HK$2.45 per share purchase price is a 12.1 percent discount to Modern Dairy’s previous closing price – a rarity in M&A where acquisitions usually come with a roughly 25 percent premium.

Modern Dairy’s share price has soared since the end of last year, from HK$2 to HK$2.79 at Tuesday’s close. Speculation about talks between Mengniu and Modern Dairy first surfaced in last August.

“The increase of Mengniu’s stake in Modern Dairy is to secure both quality and quantity of raw milk sources,” Sun Yiping, chief executive officer of Mengniu said in a press release.

For the Mengniu statement click here

Shares in Modern Dairy fell nearly 12 percent to HK$2.46 on Wednesday, while Mengniu Dairy’s stock rose 1.6 percent. The Hang Seng index was 0.62 percent higher in intra-day trade.

Standard Chartered said in a research note that part of KKR’s rationale for accepting a discount was to build a long-term relationship with COFCO, the state-owned enterprise which is the top shareholder in China Mengniu.

In addition, KKR has already earned a “quite reasonable” return on its investment, the bank added.

KKR and China-focused private equity firm CDH bought stakes in Modern Dairy after the country’s milk industry was battered by a 2008 scandal involving chemical-laced products. KKR paid $150 million in cash for a 34.5 percent stake, which it sold down to 24 percent after Mengniu’s 2010 IPO. CDH paid $50 million for its holding.

Mengniu was one of about 20 companies implicated in that scandal, when the lacing of milk with the industrial chemical melamine killed at least six children and sickened nearly 300,000 people. The company now says that enhancing the quality of its milk supplies is a key focus for management.

Mengniu teamed up with Danish-Swedish dairy group Arla Foods ARLAF.UL in June last year to develop dairy products in China, in another bid to regain consumer confidence.

But late last year Mengniu apologized after a government quality watchdog found that some of its products contained aflatoxin, a substance produced by food fungus that can cause severe liver damage, including liver cancer.

It is not alone in facing quality-control problems. China’s Bright Dairy & Food Co Ltd (600597.SS: Quote, Profile, Research, Stock Buzz) recalled batches of sour milk in September last year after it received hundreds of customer complaints, while Inner Mongolia Yili Industrial Group recalled baby formula tainted with “unusual” levels of mercury in June.

China’s dairy market is still relatively young, with consumption of dairy products growing at an annual compound rate of 20 percent, a stark contrast to U.S. and European markets where demand has been shrinking in the past decade. ($1 = 7.7602 Hong Kong dollars)

(Editing by Stephen Coates)

The Swiss bank’s financial backing for the largest ever foreign purchase of Chinese stock explains how a Thai conglomerate scraped together $7.4 billion in cash for the deal’s final payment, after its main lender backed out at the 11th hour.

The rescue role the bank played in CP Group’s acquisition of HSBC’s 15.6 percent stake in Ping An Insurance Group Co of China (601318.SS: Quote, Profile, Research, Stock Buzz) was not disclosed by the companies and has gone unreported until now.

People with direct knowledge say that UBS (UBSN.VX: Quote, Profile, Research, Stock Buzz) backed the deal with two financing facilities. The major piece of that package is a five year, roughly $5.5 billion loan, one of the largest loans of its kind ever extended in Asia, according to Thomson Reuters data.

For the help it provided, UBS is set to earn another milestone. People familiar with the matter say the bank is expected to reap, over time, about $100 million for its effort, which would make it one of the largest fees ever earned by one bank for a single transaction in Asia, Thomson Reuters data shows.

Such an extraordinary arrangement with a prized client, Thai billionaire Dhanin Chearavanont, is both a rare move for UBS and signals a key shift in strategy for the bank.

The Dhanin deal shows that the investment bank is focusing more on high margin transactions rather than standard deal flow. The aim is to cater more to faithful, fee-paying clients and constructing deals for them that may be higher in risk, but also higher in reward.

That strategy, taken on by rivals as well, comes at a time when investment banking revenues are under pressure, in part from a drop in the high-fee business of equity capital markets banking across Asia and other parts of the world.

A jumbo loan for UBS, backed by the borrower’s assets, is new turf for the bank, known more for its M&A skills and equity capital markets prowess in the region.

UBS’s secret role in the saga is just one of several plot twists that emerged in HSBC’s sale of its stake in Ping An, the world’s second-largest insurer by market value.

UBS declined to comment for this story. CP Group also declined to comment.

THE QUESTION

On December 5, HSBC Holdings Plc (HSBA.L: Quote, Profile, Research, Stock Buzz) announced that affiliates of Dhanin’s conglomerate Charoen Pokphand Group (CP Group) agreed to buy the Ping An stake for $9.4 billion, and to pay nearly $2 billion up front. The remainder was to come early in 2013, pending approval from China’s insurance regulator. The deadline for approval was set for February 1.

According to the December 5 statement, the second instalment was backed by a branch of state lender China Development Bank Corp.

Three weeks later, Chinese magazine Caixin published a story based on anonymous sources saying that the up-front payment came from entities not directly affiliated with CP Group. Beijing was under pressure to clean up corruption, and China Development Bank did not want to take any chances. People familiar with the situation say the bank backed out of its loan in early January.

HSBC announced on February 1 that China’s insurance regulator had granted approval, with final payment coming in five days. The HSBC release made no mention of China Development Bank.

The question quickly surfaced: Without China Development Bank, how did Dhanin secure the $7.4 billion? The official line was that CP Group managed to fund the last instalment itself. But doubts about that explanation lingered.

THE ANSWER

Although Dhanin is Thailand’s richest man with a net worth of $14.3 billion according to Forbes, coming up with $7.4 billion on his own was out of the question, people familiar with the matter said. He and UBS began discussions on financing in early January, they said.

Dhanin is a private banking client of UBS and the bank has worked with him and his various corporations for at least a decade on stock offerings, restructurings and acquisitions. UBS was already the sole M&A adviser to CP on the Ping An deal, a role that would earn the bank around $25 million in advisory fees, according to Thomson Reuters data.

Dhanin’s last-minute snag quickly turned UBS into a lender as well.

According to people familiar with the matter, UBS arranged a short-term facility, crafted in order to show the seller and the regulators that Dhanin had the cash on hand to pay the final amount.

A long-term financing facility then replaced the first one, once the deal was approved and the two parties knew it would go through without issue.

That second facility is a five-year, roughly $5.5 billion loan, with a few other financing products attached, including a hedging mechanism, according to the people familiar with the matter.

A financing package of that size, huge in any market, was so large that Zurich-based UBS Chief Executive Sergio Ermotti signed off on the deal personally, the people said.

Part of the roughly $5.5 billion loan was syndicated to UBS private banking clients, the people said, so that UBS is not exposed to the entire amount. Dhanin and CP Group came up with the remaining cash needed for the final $7.4 billion payment.

For UBS, backing the loan is Dhanin’s personal wealth and the various corporate entities he controls, including several publicly traded companies.

The hedging part of UBS’s financing package, the people say, was put in place to protect Dhanin’s financial interests if Ping An’s shares fall below a certain level.

The details of the package were privately negotiated and only a few senior bankers and executives are aware of the precise, complex details.

“The client had an issue, and UBS provided a solution. And UBS will be paid a fee for that solution,” said one of the people familiar with the deal.

(Additional reporting by Clare Baldwin, Stephen Aldred and Khettiya Jittapong; Editing by Edmund Klamann)

(The story corrects second paragraph to clarify the purchase was the largest ever foreign buy of Chinese stock)

The Swiss bank’s financial backing for China’s largest ever foreign stock purchase explains how a Thai conglomerate scraped together $7.4 billion in cash for the deal’s final payment, after its main lender backed out at the 11th hour.

The white knight role played by UBS AG in the deal – CP Group’s purchase from HSBC Holdings Plc of a 15.6 percent stake in Ping An Insurance Group Co of China – has gone unreported until now.

People with direct knowledge say that UBS backed the deal with two financing facilities. The major piece of that package is a five year, roughly $5.5 billion loan, one of the largest loans of its kind ever extended in Asia, according to Thomson Reuters data.

For the help it provided, UBS is set to earn another milestone. People familiar with the matter say the bank is expected to reap, over time, about $100 million for its effort, which would make it one of the largest fees ever earned by one bank for a single transaction in Asia, Thomson Reuters data shows.

Such an extraordinary arrangement with a prized client, Thai billionaire Dhanin Chearavanont, is both a rare move for UBS and signals a key shift in strategy – both for the bank and the industry.

The Dhanin deal shows that the investment bank is focusing more on high margin transactions rather than standard deal flow. The aim is to cater more to faithful, fee-paying clients and constructing deals for them that may be higher in risk, but also higher in reward.

That strategy, taken on by rivals as well, comes at a time when investment banking revenues are under pressure, in part from a drop in the high-fee business of equity capital markets banking across Asia and other parts of the world.

THE QUESTION

A jumbo loan for UBS, backed by the borrower’s assets, is new turf for the bank, known more for its M&A skills and equity capital markets prowess in the region.

UBS’s secret role in the saga is just one of several plot twists that emerged in HSBC’s sale of its stake in Ping An, the world’s second-largest insurer by market value.

UBS declined to comment for this story. Dhanin and the company he controls, CP Group, also declined to comment.

On December 5, HSBC announced that affiliates of Dhanin’s conglomerate Charoen Pokphand Group (CP Group) agreed to buy the Ping An stake for $9.4 billion, and to pay nearly $2 billion up front. The remainder was to come early in 2013, pending approval from China’s insurance regulator and the deadline for approval was set for February 1.

According to the December 5 statement, the second installment was backed in part by a branch of state lender China Development Bank Corp.

Three weeks later, Chinese magazine Caixin published a story based on anonymous sources saying that the up-front payment came from entities not directly affiliated with CP Group. Beijing was under pressure to clean up corruption, and China Development Bank did not want to take any chances. People familiar with the situation say the bank backed out of its loan in early January.

HSBC announced on February 1 that China’s insurance regulator had granted approval, with final payment coming in five days. The deal was nearly complete. The HSBC release made no mention of China Development Bank.

The question quickly surfaced: Without China Development Bank, how did Dhanin secure the $7.4 billion? The official line was that CP Group managed to fund the last installment itself. But doubts about that explanation lingered.

THE ANSWER

Although Dhanin is Thailand’s richest man with a net worth of $14.3 billion according to Forbes, coming up with $7.4 billion on his own was out of the question, people familiar with the matter said. He and UBS began discussions on financing in early January, they said.

Dhanin is a private banking client of UBS and the bank has worked with him and his various corporations for at least a decade on stock offerings, restructurings and acquisitions. UBS was already the sole M&A adviser to CP on the Ping An deal, a role that would earn the bank around $25 million in advisory fees, according to Thomson Reuters data.

Dhanin’s last-minute snag quickly turned UBS into a lender as well.

According to people familiar with the matter, UBS arranged a short-term facility, crafted in order to show the seller and the regulators that Dhanin had the cash on hand to pay the final amount.

A long-term financing facility then replaced the first one, once the deal was approved and the two parties knew it would go through without issue.

That second facility is a five-year, roughly $5.5 billion loan, with a few other financing products attached, including a hedging mechanism, according to the people familiar with the matter.

A financing package of that size, huge in any market, was so large that Zurich-based UBS Chief Executive Sergio Ermotti signed off on the deal personally, the people said.

Part of the roughly $5.5 billion loan was syndicated to UBS private banking clients, the people said, so that UBS is not exposed to the entire amount. Dhanin and CP Group came up with the remaining cash needed for the final $7.4 billion payment.

For UBS, backing the loan is Dhanin’s personal wealth and the various corporate entities he controls, including several publicly traded companies.

The hedging part of UBS’s financing package, the people say, was put in place to protect Dhanin’s financial interests if Ping An’s shares fall below a certain level.

The details of the package were privately negotiated and only a few senior bankers and executives are aware of the precise, complex details.

“The client had an issue, and UBS provided a solution. And UBS will be paid a fee for that solution,” said one of the people familiar with the deal.

(Additional reporting by Clare Baldwin, Stephen Aldred and Khettiya Jittapong; Editing by Edmund Klamann)

The Swiss bank’s financial backing for China’s largest ever
foreign stock purchase explains how Thailand’s richest person
and his conglomerate pulled together $7.4 billion in cash for
the deal’s final payment, after its main lender backed out at
the 11th hour.

The rescue role the bank played in CP Group’s acquisition of
HSBC’s 15.6 percent stake in Ping An Insurance Group Co of China
was not disclosed by the companies and has gone
unreported until now.

People with direct knowledge say that UBS backed
the deal with two financing facilities. The major piece of that
package is a five year, roughly $5.5 billion loan, one of the
largest loans of its kind ever extended in Asia, according to
Thomson Reuters data.

For the help it provided, UBS is set to earn another
milestone. People familiar with the matter say the bank is
expected to reap, over time, about $100 million for its effort,
which would make it one of the largest fees ever earned by one
bank for a single transaction in Asia, Thomson Reuters data
shows.

Such an extraordinary arrangement with a prized client, Thai
billionaire Dhanin Chearavanont, is both a rare move for UBS and
signals a key shift in strategy for the bank.

The Dhanin deal shows that the investment bank is focusing
more on high margin transactions rather than standard deal flow.
The aim is to cater more to faithful, fee-paying clients and
constructing deals for them that may be higher in risk, but also
higher in reward.

That strategy, taken on by rivals as well, comes at a time
when investment banking revenues are under pressure, in part
from a drop in the high-fee business of equity capital markets
banking across Asia and other parts of the world.

A jumbo loan for UBS, backed by the borrower’s assets, is
new turf for the bank, known more for its M&A skills and equity
capital markets prowess in the region.

UBS’s secret role in the saga is just one of several plot
twists that emerged in HSBC’s sale of its stake in Ping An, the
world’s second-largest insurer by market value.

UBS declined to comment for this story. CP Group also
declined to comment.

THE QUESTION

On Dec. 5, HSBC Holdings Plc announced that
affiliates of Dhanin’s conglomerate Charoen Pokphand Group (CP
Group) agreed to buy the Ping An stake for $9.4 billion, and to
pay nearly $2 billion up front. The remainder was to come early
in 2013, pending approval from China’s insurance regulator. The
deadline for approval was set for Feb. 1.

According to the Dec. 5 statement, the second instalment was
backed by a branch of state lender China Development Bank Corp.

Three weeks later, Chinese magazine Caixin published a story
based on anonymous sources saying that the up-front payment came
from entities not directly affiliated with CP Group. Beijing was
under pressure to clean up corruption, and China Development
Bank did not want to take any chances. People familiar with the
situation say the bank backed out of its loan in early January.

HSBC announced on Feb. 1 that China’s insurance regulator
had granted approval, with final payment coming in five days.
The HSBC release made no mention of China Development Bank.

The question quickly surfaced: Without China Development
Bank, how did Dhanin secure the $7.4 billion? The official line
was that CP Group managed to fund the last instalment itself.
But doubts about that explanation lingered.

THE ANSWER

Although Dhanin is Thailand’s richest man with a net worth
of $14.3 billion according to Forbes, coming up with $7.4
billion on his own was out of the question, people familiar with
the matter said. He and UBS began discussions on financing in
early January, they said.

Dhanin is a private banking client of UBS and the bank has
worked with him and his various corporations for at least a
decade on stock offerings, restructurings and acquisitions. UBS
was already the sole M&A adviser to CP on the Ping An deal, a
role that would earn the bank around $25 million in advisory
fees, according to Thomson Reuters data.

Dhanin’s last-minute snag quickly turned UBS into a lender
as well.

According to people familiar with the matter, UBS arranged a
short-term facility, crafted in order to show the seller and the
regulators that Dhanin had the cash on hand to pay the final
amount.

A long-term financing facility then replaced the first one,
once the deal was approved and the two parties knew it would go
through without issue.

That second facility is a five-year, roughly $5.5 billion
loan, with a few other financing products attached, including a
hedging mechanism, according to the people familiar with the
matter.

A financing package of that size, huge in any market, was so
large that Zurich-based UBS Chief Executive Sergio Ermotti
signed off on the deal personally, the people said.

Part of the roughly $5.5 billion loan was syndicated to UBS
private banking clients, the people said, so that UBS is not
exposed to the entire amount. Dhanin and CP Group came up with
the remaining cash needed for the final $7.4 billion payment.

For UBS, backing the loan is Dhanin’s personal wealth and
the various corporate entities he controls, including several
publicly traded companies.

The hedging part of UBS’s financing package, the people say,
was put in place to protect Dhanin’s financial interests if Ping
An’s shares fall below a certain level.

The details of the package were privately negotiated and
only a few senior bankers and executives are aware of the
precise, complex details.

“The client had an issue, and UBS provided a solution. And
UBS will be paid a fee for that solution,” said one of the
people familiar with the deal.

(Additional reporting by Clare Baldwin, Stephen Aldred and
Khettiya Jittapong; Editing by Edmund Klamann)

The hiring of Burnett, the Asia chairman of global capital markets at UBS, comes less than two years after Standard Chartered hired Mark Dowie. Dowie is Standard Chartered’s global head of corporate finance and a former UBS vice chairman of investment banking.

Burnett and Dowie worked together at UBS in Hong Kong as co-investment banking heads for Asia between 2000 and 2004. Dowie later became vice chairman of investment banking at the Swiss bank, leaving for London in 2004.

“I am greatly looking forward to working with Mark again, especially in building on our past successes,” Burnett told Reuters in an email.

Dowie, a former British naval officer, left UBS that same year to start his own boat repair and sales company. Burnett moved on to another senior role at UBS in the Middle East in 2006. Shortly after selling the marine business, Dowie re-entered banking, joining Standard Chartered in August 2011.

Burnett’s hiring comes as Dowie aims to build the bank’s M&A advisory and ECM businesses.

Standard Chartered’s corporate finance business model differs from traditional investment banks that rely on more heavily on equity capital market underwriting and mergers and acquisitions advisory to earn the majority of its revenues.

The London-based bank, which does more than 80 percent of its business in emerging markets such as Asia, leans more on its core lending franchise.

Standard Chartered’s corporate finance’s operating income is $2.22 billion, 40 percent of which comes from lending activities around structured trade finance, leasing finance, asset-based financing.

Burnett will start on April 8 and remain based in Hong Kong, Standard Chartered said.

(Editing by Ryan Woo)

Their fields are as thin as asphalt and there is no weight training room.

Poor facilities is just one bump the organization has faced in the past few years, a larger one being the murder of Jamaica rugby stalwart Jacob Thompson in 2009.

But the sport has pressed on in a country better known for its track and field prowess, not to mention its brief foray into bobsledding. The Jamaican rugby team gained a spot in the sixth leg of the international sevens tour this year, arriving in Hong Kong last week for its debut in the 38th annual tournament.

Rugby sevens, where seven players compete in a fast paced version of the normally 15 per side game, has grown from an amateur sport to fully professional for some of the top teams.

The more than 20 nations who now compete have their eye on gaining a berth for the 2016 Olympics in Brazil, where the sport will be incorporated for the first time.

The international circuit, the corporate sponsorship from the likes of HSBC, and the Olympic goal has transformed rugby sevens from amateur to professional. For the Jamaican team, however, the resources available to them have changed little over the course of time.

“We just play for the love of the game,” said team captain Tyronie Rowe, 25.

His team mates juggle small children and factory jobs with a rigorous training schedule leading up to the sevens season.

Some major teams have fully paid players and more than a million dollars at their disposal, while others have a fraction of that. For Jamaica sevens, there is no money, having failed to gain a single corporate sponsor.

But the team has persevered. Rowe, a father of three, dwells on the progress, pointing out that a previous game years ago against Georgia ended in a loss by nearly 90 points. Their meeting over the weekend was a 27-17 defeat.

“We are starting to get rugby back,” said Jamaica’s coach Conroy O’Malley. He acknowledges that disorganization within Jamaica’s own rugby administration, coupled with competition from other local sports leagues has hampered the expansion of international rugby in his country.

A major blow to the sport, however, was the murder of Thompson, an internationally respected rugby figure who was credited with building the sport in Jamaica over the span of 40 years.

“He was really the backbone of Jamaican rugby,” said Jamaican sevens player Ronaldo Wade, 24.

Rowe said he was fortunate the sport came into his life, having grown up in a Kingston ghetto. He now travels the world as a rugby player, doing 1,000 push ups a day to make up for the lack of a proper weight room.

Kids in his neighbourhood who do not commit themselves full time to sport inevitably turn to guns, he said.

“In our area, rugby is the one of the only ways to stay out of trouble,” Rowe said.

Jamaica’s two other games in Hong Kong were a 43-0 loss to Asian powerhouse Japan, and a 31-5 loss to Brazil, another Hong Kong newcomer. The weekend ended on a high note, however, with Jamaica scoring its five points against Brazil with a last second, air-borne try.

Rowe said he was proud of his team, and he expected to come back to Hong Kong next year, with a better result. Gazing out at the field on Saturday, he was struck at the quality of the event, and of the pitch.

“That field is like velvet compared to ours back home,” he said.

(Editing by Justin Palmer)

Their fields are as thin as asphalt and there is no weight training room.

Poor facilities is just one bump the organization has faced in the past few years, a larger one being the murder of Jamaica rugby stalwart Jacob Thompson in 2009.

But the sport has pressed on in a country better known for its track and field prowess, not to mention its brief foray into bobsledding. The Jamaican rugby team gained a spot in the sixth leg of the international sevens tour this year, arriving in Hong Kong last week for its debut in the 38th annual tournament.

Rugby sevens, where seven players compete in a fast paced version of the normally 15 per side game, has grown from an amateur sport to fully professional for some of the top teams.

The more than 20 nations who now compete have their eye on gaining a berth for the 2016 Olympics in Brazil, where the sport will be incorporated for the first time.

The international circuit, the corporate sponsorship from the likes of HSBC, and the Olympic goal has transformed rugby sevens from amateur to professional. For the Jamaican team, however, the resources available to them have changed little over the course of time.

“We just play for the love of the game,” said team captain Tyronie Rowe, 25.

His team mates juggle small children and factory jobs with a rigorous training schedule leading up to the sevens season.

Some major teams have fully paid players and more than a million dollars at their disposal, while others have a fraction of that. For Jamaica sevens, there is no money, having failed to gain a single corporate sponsor.

But the team has persevered. Rowe, a father of three, dwells on the progress, pointing out that a previous game years ago against Georgia ended in a loss by nearly 90 points. Their meeting over the weekend was a 27-17 defeat.

“We are starting to get rugby back,” said Jamaica’s coach Conroy O’Malley. He acknowledges that disorganization within Jamaica’s own rugby administration, coupled with competition from other local sports leagues has hampered the expansion of international rugby in his country.

A major blow to the sport, however, was the murder of Thompson, an internationally respected rugby figure who was credited with building the sport in Jamaica over the span of 40 years.

“He was really the backbone of Jamaican rugby,” said Jamaican sevens player Ronaldo Wade, 24.

Rowe said he was fortunate the sport came into his life, having grown up in a Kingston ghetto. He now travels the world as a rugby player, doing 1,000 push ups a day to make up for the lack of a proper weight room.

Kids in his neighbourhood who do not commit themselves full time to sport inevitably turn to guns, he said.

“In our area, rugby is the one of the only ways to stay out of trouble,” Rowe said.

Jamaica’s two other games in Hong Kong were a 43-0 loss to Asian powerhouse Japan, and a 31-5 loss to Brazil, another Hong Kong newcomer. The weekend ended on a high note, however, with Jamaica scoring its five points against Brazil with a last second, air-borne try.

Rowe said he was proud of his team, and he expected to come back to Hong Kong next year, with a better result. Gazing out at the field on Saturday, he was struck at the quality of the event, and of the pitch.

“That field is like velvet compared to ours back home,” he said. (Editing by Justin Palmer)

“When I walked through the door, I remember thinking ‘what have I done?’” Friday recalls.

The practice field was a mixture of dirt and parched, yellow grass. His few resources were a bag of cones, balls and a conditioning coach.

The players arrived, “half on time, half not,” according to Friday, a former England sevens skipper.

Kenya’s rugby sevens team, suffering from years of inconsistency, a slim wallet, and an annual turnover of coaches, needed someone to turn the programme around. Friday has been that someone.

Last month, Kenya defeated New Zealand, the world’s premier rugby union nation, in the semi-finals of a Seven World Series tournament in the nation’s capital Wellington before losing in extra time to England in the final.

Through a combination of tough love, obsessive conditioning, and a back-to-basics approach, Kenya are enjoying their best season ever on the international circuit. The young squad are competing in the sixth tournament of the year this weekend in the Hong Kong Sevens, the world’s most renowned sevens tournament.

What makes Kenya’s success extraordinary is that an amateur team playing international sevens, the abbreviated version of the 15-a-side rugby union game which will make its Olympic debut at the 2016 Rio de Janeiro Games, are competing against professional rivals.

Kenya are currently ranked sixth of the 15 teams in the international sevens standings. Several of the teams above and below Kenya are made up entirely of fulltime, professional players on contract.

The total budget for Kenya’s sevens team is roughly $200,000 (131,285 pounds), which goes on 10 tournaments from Dubai to London to Mumbai, hotels, airplanes, equipment.

“We didn’t expect to make any semi-final,” Friday said in Hong Kong, speaking after the team’s opening 17-14 win over the United States. “The aim was to get into Cup competition.” The team have made two semi-finals and a final this year.

Despite the wins, managing a small budget and local politics remains a challenge to the team. Leading player Collins Injera, one of the all-time leading scorers in the sport, was dropped from the team’s Hong Kong leg, the result of a dispute with his local rugby club. Such a disappointment was typical of the team’s history of two strides forward, two strides back.

Keeping Injera off the roster in Hong Kong was consistent with Friday’s focus on accountability and discipline, something he stressed on his first day on the job when he said that anyone that did not want to buy into his programme should leave.

NEW ERA

Most days, Sidney Ashioya, 27, wakes up before sunrise, works out for 90 minutes, and then travels to work as an IT manager at a Nairobi NGO (non-government organization).

After work he heads to wherever the team is training, and joins them for another two to three hours. Like his teammates, Ashioya may spend more than six hours of his day travelling and training. Many of his team mates have had to choose between sport and work.

“We’ve shifted from participating in tournaments, to competing in tournaments,” says Ashioya, a nine-year veteran of the team. He has lived the ups and downs of Kenya’s sevens programme, adding that he’s now on his sixth coach.

The bulk of the team is between the age of 19 and 24, with several players starting the sport through their high school programs. Ashioya first played as a 15-year-old, a stark contrast to players in Australia and New Zealand who start as soon as they can walk.

Only six players in the 30-man team dedicate all their time to the sport and they are all from Kenya.

Biko Adema, 25, works as a registry agent at an embassy in Nairobi. His commute to work and rugby involves hours of time daily on the city’s rickety public transport system. He credits part of the success of the season with the intense strength and conditioning regime.

“We started from scratch. A number of training sessions we just did the same things, over and over,” Adema said.

The tight budget and limited resources is not just something the coach worries about, but is on the minds of the players too.

“We have limited financial resources. With the amount of training we’ve done, and the success we’ve had, obviously we hope our sponsorship improves,” Adema added.

(Editing by John Mehaffey)

“When I walked through the door, I remember thinking ‘what have I done?’” Friday recalls.

The practice field was a mixture of dirt and parched, yellow grass. His few resources were a bag of cones, balls and a conditioning coach.

The players arrived, “half on time, half not,” according to Friday, a former England sevens skipper.

Kenya’s rugby sevens team, suffering from years of inconsistency, a slim wallet, and an annual turnover of coaches, needed someone to turn the programme around. Friday has been that someone.

Last month, Kenya defeated New Zealand, the world’s premier rugby union nation, in the semi-finals of a Seven World Series tournament in the nation’s capital Wellington before losing in extra time to England in the final.

Through a combination of tough love, obsessive conditioning, and a back-to-basics approach, Kenya are enjoying their best season ever on the international circuit. The young squad are competing in the sixth tournament of the year this weekend in the Hong Kong Sevens, the world’s most renowned sevens tournament.

What makes Kenya’s success extraordinary is that an amateur team playing international sevens, the abbreviated version of the 15-a-side rugby union game which will make its Olympic debut at the 2016 Rio de Janeiro Games, are competing against professional rivals.

Kenya are currently ranked sixth of the 15 teams in the international sevens standings. Several of the teams above and below Kenya are made up entirely of fulltime, professional players on contract.

The total budget for Kenya’s sevens team is roughly $200,000, which goes on 10 tournaments from Dubai to London to Mumbai, hotels, airplanes, equipment.

“We didn’t expect to make any semi-final,” Friday said in Hong Kong, speaking after the team’s opening 17-14 win over the United States. “The aim was to get into Cup competition.” The team have made two semi-finals and a final this year.

Despite the wins, managing a small budget and local politics remains a challenge to the team. Leading player Collins Injera, one of the all-time leading scorers in the sport, was dropped from the team’s Hong Kong leg, the result of a dispute with his local rugby club. Such a disappointment was typical of the team’s history of two strides forward, two strides back.

Keeping Injera off the roster in Hong Kong was consistent with Friday’s focus on accountability and discipline, something he stressed on his first day on the job when he said that anyone that did not want to buy into his programme should leave.

NEW ERA

Most days, Sidney Ashioya, 27, wakes up before sunrise, works out for 90 minutes, and then travels to work as an IT manager at a Nairobi NGO (non-government organization).

After work he heads to wherever the team is training, and joins them for another two to three hours. Like his teammates, Ashioya may spend more than six hours of his day traveling and training. Many of his team mates have had to choose between sport and work.

“We’ve shifted from participating in tournaments, to competing in tournaments,” says Ashioya, a nine-year veteran of the team. He has lived the ups and downs of Kenya’s sevens programme, adding that he’s now on his sixth coach.

The bulk of the team is between the age of 19 and 24, with several players starting the sport through their high school programs. Ashioya first played as a 15-year-old, a stark contrast to players in Australia and New Zealand who start as soon as they can walk.

Only six players in the 30-man team dedicate all their time to the sport and they are all from Kenya.

Biko Adema, 25, works as a registry agent at an embassy in Nairobi. His commute to work and rugby involves hours of time daily on the city’s rickety public transport system. He credits part of the success of the season with the intense strength and conditioning regime.

“We started from scratch. A number of training sessions we just did the same things, over and over,” Adema said.

The tight budget and limited resources is not just something the coach worries about, but is on the minds of the players too.

“We have limited financial resources. With the amount of training we’ve done, and the success we’ve had, obviously we hope our sponsorship improves,” Adema added. (Editing by John Mehaffey)