Wasps And Worcester’s Financial Woes Continue
Gallagher Premiership rugby union club Wasps has filed notice in the High Court that it intends to appoint administrators, as Premiership rugby continues to battle with financial issues.
In a statement, Wasps Holdings Limited, which includes the Premiership club and Arena Coventry Limited, has said that the move ‘does not mean the business is in administration’.
Wasps claimed last month it was in talks with His Majesty’s Revenue & Customs (HMRC) over an unpaid tax bill, and the latest move has been made to ensure the club is protected from the threat of legal action.
The Coventry-based club failed to repay a debt of £35m that was due to bondholders in May, though the club recently stated that they were in ‘advanced discussions’ to refinance the bond, which helped fund the move from London to the Midlands in 2014.
Wasps Holdings Limited have also said that negotiations with ‘a number of interested parties’ regarding a sale have been ‘going on for some time, are in advanced stages and we are hopeful of securing a deal’.
‘In the meantime, the day-to-day operations of the business are unaffected, and we will continue to support our players, staff, supporters, bond holders and suppliers, and keep them fully updated during what we appreciate will be an unsettling time,’ the statement continued.
Under Rugby Football Union (RFU) rules, if insolvency occurs after the season has started, relegation is the consequence, unless the club can prove that the financial difficulties are 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.
Wasps join another Premiership rugby union club Worcester Warriors currently experiencing major financial struggles.
The RFU has recently threatened Worcester with suspension from all competitions unless it can prove it has a ‘credible’ plan for the future by 26th September.
It also wants to see evidence of insurance cover and funds to cover the monthly payroll by the deadline, and to ensure it can safely stage this Saturday’s match with Newcastle by midday on Thursday 22nd September.
Many of the club’s non-playing staff have only been paid 65% of their salary for August, while others have received nothing.
Owners Jason Whittingham and Colin Goldring had announced they had agreed a deal to sell the club on 13th September, but the sale has yet to come to fruition. Now the clock is ticking for the Warriors with the deadline approaching.
