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Wasps into administration
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Steve@Mose View Drop Down
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    Posted: 21 Sep 2022 at 16:48
Wasps face relegation from Gallagher Premiership over unpaid bonds

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Wasps face relegation from the Gallagher Premiership after filing notice in the High Court of their intention to appoint an administrator as the financial crisis in English club rugby deepens.

The club had been due to pay back £35 million in bonds, which helped finance their relocation to Coventry from London in 2014, in May but were unable to meet the deadline.

Wasps had been looking for refinance options but this afternoon issued notice of intention to appoint an administrator.

Under RFU rules, a team that goes into administration faces automatic relegation unless they can demonstrate that the financial crisis was not their fault.


Edited by Steve@Mose - 21 Sep 2022 at 21:09
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Richard Lowther View Drop Down
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Points: 6592 		Post Options Post Options   Thanks (0) Thanks(0)   Quote Richard Lowther Quote  Post ReplyReply Direct Link To This Post Posted: 21 Sep 2022 at 17:24
What an complete mess. 
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Big Eddie View Drop Down
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Originally posted by Richard Lowther Richard Lowther wrote:

What an complete mess. 

This won't help Worcester, the Premiership, The RFU or rugby in general.

There could be a chain reaction
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Points: 6592 		Post Options Post Options   Thanks (1) Thanks(1)   Quote Richard Lowther Quote  Post ReplyReply Direct Link To This Post Posted: 21 Sep 2022 at 17:47
Originally posted by Big Eddie Big Eddie wrote:

Originally posted by Richard Lowther Richard Lowther wrote:

What an complete mess. 

This won't help Worcester, the Premiership, The RFU or rugby in general.

There could be a chain reaction

I agree on the last comment. Various message boards rumours about another club in difficulties. 

However I dont think we should confuse the poor state of the Premiership with the game as a whole.
But this should be the time that the RFU set the direction and terms for the next agreement with the Premiership clubs and those terms should be more advantageous to the game as a whole than the 13 current Premiership clubs. 
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Richard Lowther View Drop Down
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Points: 6592 		Post Options Post Options   Thanks (0) Thanks(0)   Quote Richard Lowther Quote  Post ReplyReply Direct Link To This Post Posted: 21 Sep 2022 at 17:54
A fire sale merger of Wasps and Worcester playing at Sixways could be the answer. Worcester Wasps. 
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kingsheathlad View Drop Down
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Where would they play if merged. 
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Points: 1855 		Post Options Post Options   Thanks (0) Thanks(0)   Quote billesleyexile Quote  Post ReplyReply Direct Link To This Post Posted: 21 Sep 2022 at 18:21
Originally posted by Richard Lowther Richard Lowther wrote:

Various message boards rumours about another club in difficulties. 


Those of us who also frequent the RL message boards might well be aware of one that's been bubbling away for months.


Edited by billesleyexile - 21 Sep 2022 at 18:22
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billesleyexile View Drop Down
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Points: 1855 		Post Options Post Options   Thanks (2) Thanks(2)   Quote billesleyexile Quote  Post ReplyReply Direct Link To This Post Posted: 21 Sep 2022 at 18:28
Meanwhile over on Shedweb someone makes the point that 'rugby can't afford to lose established clubs' like Worcester and Wasps.

Memory span of a goldfish. Top flight/list A rugby has 'lost' Moseley, Coventry, London Scottish, Richmond, Orrell, Waterloo, London Welsh, West Hartlepool etc. 

RU has done nothing but lose 'established clubs.'
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Points: 5045 		Post Options Post Options   Thanks (2) Thanks(2)   Quote Big Eddie Quote  Post ReplyReply Direct Link To This Post Posted: 21 Sep 2022 at 19:39
Originally posted by Richard Lowther Richard Lowther wrote:

A fire sale merger of Wasps and Worcester playing at Sixways could be the answer. Worcester Wasps. 

In my experience a merger of two failing businesses rarely works.......just promote Doncaster and Ealing and send Wasps and Worcester to level 9 
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omnes Paviores View Drop Down
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Points: 115 		Post Options Post Options   Thanks (0) Thanks(0)   Quote omnes Paviores Quote  Post ReplyReply Direct Link To This Post Posted: 21 Sep 2022 at 20:33
Does this suggest that Caldy replace Newcastle or any of the others nearing finance troubles.

Oh what a rise to stardom for Caldy
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Originally posted by billesleyexile billesleyexile wrote:

Originally posted by Richard Lowther Richard Lowther wrote:

Various message boards rumours about another club in difficulties. 


Those of us who also frequent the RL message boards might well be aware of one that's been bubbling away for months.

A league or union club?
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Premiership club to appoint administrators to 'protect club's interests'

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Wasps have filed notice in the High Court that they intend to appoint administrators to "protect the club's interests".

Wasps Holdings Limited, which includes the Premiership club and Arena Coventry Limited, said the move "does not mean the business is in administration".

It said it will provide "a crucial period of grace" as it tries to "secure the long-term future of the group".

The measure was taken amid an "impending threat of action from HMRC".

.....

The RFU confirmed it is in dialogue with Wasps, and "will work with them to understand the current action, their sustainability plans and what the next steps will be".

Under RFU rules, if insolvency occurs after the season has started, relegation is the consequence, unless the club succeeds with a 'no-fault' application - effectively demonstrating the financial crisis was not their fault.

The situation is further complicated by the fact relegation from England's top tier has been put on hold in the wake of the coronavirus pandemic.
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Good point - but all of those clubs have survived and are still playing at various leagues. The make up of the top flight has radically changed. There is a common thread amongst the fallen giants: selling their grounds and not having a feasible replacement and/or the benefactors pulled out. 

When Dai Duckham’s Coventry and Sam Doble’s Moseley were the best teams in the country, Exeter, Saracens and Worcester were way down the league structure.
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Feel sorry for the staff and players at Wasps as it can’t be a nice situation to be in but I have no sympathy for the owners of Premiership Clubs who have been quite happy to ride the RFU and PRL gravy train whilst showing a complete lack of interest in the good of the game and also in the Championship. Our league has been sidelined and ignored for two decades. Covid threw a giant spanner in the works and laid bare the absolutely diabolical state that the professional game is in. The karma train is well and truly running the RFU and PRL over. 
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I predict that the PRL and RFU will invoke the relevant 'pandemic' clauses to justify not relegating Wasps, which blows me away as there is no real reason to protect them. Even from a geographic standpoint, there is a strong, well-supported Coventry team in place.
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I agree - PRL and RFU have been pretty spineless when dealing with Worcester's issues, and I can't see them letting another club go under if Worcester go to the wall.
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Points: 6592 		Post Options Post Options   Thanks (0) Thanks(0)   Quote Richard Lowther Quote  Post ReplyReply Direct Link To This Post Posted: 22 Sep 2022 at 07:41
Originally posted by gerg_861 gerg_861 wrote:

I predict that the PRL and RFU will invoke the relevant 'pandemic' clauses to justify not relegating Wasps, which blows me away as there is no real reason to protect them. Even from a geographic standpoint, there is a strong, well-supported Coventry team in place.

I don't believe the Pandemic could be used as an excuse in either case. Worcester and presumably Wasps took the Covid money on offer from the Government which was intended to prevent issues like this. 

Wasps' mess is from the financial bond, not anything else. It always came with a risk and that risk was independent of Covid. 

I have totally sympathy with the supporters and players of both clubs but if the RFU want to stop the dominos toppling they have been really firm now, or else others will take advantage of that 'generosity' and we will be seeing more clubs fail without any real repercussions to them - only their creditors, whilst better run clubs are kept out of the elite and would be treated differently by the RFU. 
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Richard Lowther View Drop Down
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Points: 6592 		Post Options Post Options   Thanks (0) Thanks(0)   Quote Richard Lowther Quote  Post ReplyReply Direct Link To This Post Posted: 22 Sep 2022 at 07:51
Originally posted by Richard Lowther Richard Lowther wrote:

Originally posted by gerg_861 gerg_861 wrote:

I predict that the PRL and RFU will invoke the relevant 'pandemic' clauses to justify not relegating Wasps, which blows me away as there is no real reason to protect them. Even from a geographic standpoint, there is a strong, well-supported Coventry team in place.

I don't believe the Pandemic could be used as an excuse in either case. Worcester and presumably Wasps took the Covid money on offer from the Government which was intended to prevent issues like this. 

Wasps' mess is from the financial bond, not anything else. It always came with a risk and that risk was independent of Covid. 

I have totally sympathy with the supporters and players of both clubs but if the RFU want to stop the dominos toppling they have been really firm now, or else others will take advantage of that 'generosity' and we will be seeing more clubs fail without any real repercussions to them - only their creditors, whilst better run clubs are kept out of the elite and would be treated differently by the RFU. 

Ps. What the heck happened to the CVC money? 
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castleparknight View Drop Down
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Points: 3023 		Post Options Post Options   Thanks (0) Thanks(0)   Quote castleparknight Quote  Post ReplyReply Direct Link To This Post Posted: 22 Sep 2022 at 08:16
Originally posted by gerg_861 gerg_861 wrote:

I predict that the PRL and RFU will invoke the relevant 'pandemic' clauses to justify not relegating Wasps

I was under the impression that the pandemic clause, was a recent addition and was to protect clubs from future pandemics, not the previous pandemic. And as Richard pointed out this goes way back to 2014. And yes what happened to the CVC money?

For WASPS sake I hope they can resolve the problems they are experiencing, but if they are unable to do so then they should face the same penalties as other clubs prior to them.
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Big Eddie View Drop Down
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I have had an initial look at the accounts of a couple of the Premiership clubs and although it isn't clear to me I would suggest the CVC money may have been utilised by the shareholders by way of loans to them or one of their companies or by dividends if there were sufficient retained profits to do so.

There is nothing financially or legally improper if they did that and they have all been supporting the financial haemorrhaging for many years and the CVC deal would have been a godsend to them. However, as events have subsequently unfolded it may have been more prudent to retain such funds within the company........perhaps some of the clubs did so.

If I have some time this weekend I will do some proper analysis.

In one set of accounts the balance sheet is only solvent because of the upwards revaluation of the P shares held by that particular company. With at least two clubs insolvent or close to insolvency it brings starkly into focus the value of the P shares..........this maybe another shoe waiting to drop


Edited by Big Eddie - 22 Sep 2022 at 09:06
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