Wasps owner hits back at 'ill-informed' rumours about club
Speculation continues to mount regarding the future of Wasps Rugby this weekend as their financial outlook looks increasingly grim.
Wasps have now failed to meet three deadlines on bond repayments, having raised £35 million in bonds on the London Stock Exchange back in 2015. An initial May repayment day was missed and they subsequently missed a second pushed-back date in June.
On Friday they reportedly missed their latest deadline for the bond repayment, much of which is owed to fans of the club who availed of the bonds in 2015. They will continue to pay interest on the bonds, which is 6.5 per cent per annum.
Irish owner Derek Richardson has said that the club are not going into administration, despite rumours doing the rounds on the internet.
“Contrary to some ill-informed speculation, we are not in administration and we are not going to be,” Richardson told The Times yesterday. “We made a statement on the bond repayment on May 13, we’ve been very transparent with the market and the bond-holders. We’ve paid the interest on the bond and will continue to when it is due.”
Defaulting on bondholders can have significant financial implications for the company that issues the bond which could in turn leave financial institutions reluctant to lend them money.
Wasps are currently in the midst of trying to refinance the debt but any refinancing would hang on the valuation of the Coventry Building Society Arena. One source told RugbyPass that Wasps were looking at a valuation of between £50m to £60m for the arena and hotel. The problem for Wasps is that they in effect have one realistic buyer for a sports stadium in Coventry, that being Coventry City FC. Another third party could theoretically buy Wasps, the stadium and their debt, although this seems unlikely.
With three deadlines now elapsed, it doesn’t appear that Wasps have reached an agreement with HSBC, despite appearing to suggest that they had in a May statement.
The problem for bondholders is that the bonds are not protected by the Financial Services Compensation Scheme (the FSCS).” As a result, according to Wasps documentation “neither the FSCS nor anyone else will pay compensation to you upon the failure of the Issuer, the Guarantors or the Group as a whole.”
Put simply, the fate of the bondholders is more or less entirely reliant on Wasps’ financial viability. If the club went under, they would be looking at a significant haircut after preferred creditors were repaid.
On the playing front, money has been saved. Significant saving on salaries have been made at the end of last season, with 11 squad members heading to the exit – including three All Blacks. Malakai Fekitoa, Vaea Fifita, Jimmy Gopperth, Thomas Young, Cameron Anderson, Michael Le Bourgeois, James Gaskell, Rob Miller, Pieter Scholtz, Jeff Toomaga-Allen and Marcus Watson have all left the club.
Against this eight players have signed ahead of the new season, with Springbok prop Vincent Koch the most high-profile hire.
With relegation not returning to the Gallagher Premiership until season 2024/25, if Wasps are looking save money on player salaries at the cost of league position, now is as good a time as any.
Axing of salary overheads would also certainly help when it comes to servicing the £2,275,000 owed in interest to bondholders per annum.
Despite speculation and unlike in association football where clubs are deducted points for going into administration, RugbyPass understands that Premiership Rugby Ltd would not look to punish Wasps further. There is a precedent for Gallagher Premiership sides going under, with Richmond and more recently London Welsh falling to that fate.
Comments on RugbyPass
Why cant I watch Rugby games please?
1 Go to commentsBeautiful shot from Finau, end of story. Gutted for Shaun Stevenson though.
4 Go to commentsThe Chiefs definitely didn’t win ugly. They had the superior scrum, a dominant lineout, and their defence was excellent once the Waratahs scored their two tries (thanks to some lucky refereeing calls mind you). They put pressure on the Waratahs lineout throughout the game, and the mind boggles as to why the referee did not award a yellow card or a penalty try against the Waratahs for repeated scrum infringements on their own try line before Narawa’s first try. And the Chiefs were slick with their passing and running angles on attack. It was a dominant performance all round, even with many questionable refereeing decisions.
1 Go to commentsWasnt late. Ref 2 assistants andTMO all saw it so who are you to say it was?
4 Go to commentsAre the Brumbies playing the Blues twice in a row?
4 Go to commentsBig difference from the Saders. Forwards really muscled up and laid a solid platform. Scooter brought some steel and I liked the loosie combination. Newell has been rather disappointing this season but stepped up big time - happy also to see Franks dot down. He should do that more often! Reihana had a good game and there seems to be more flair and invention with him in the saddle. McNicoll plays well from the back and is reliable plus inventive when he joins the line. Keep it up chaps!
3 Go to comments🤦♂️🤣 who cares who’s the best . All I know is the All Blacks have the star coach but have few star players now …
30 Go to commentsJe suis sûr que Farrell est impatient de jouer avec Lopez et Machenaud et d’être entraîné par Collazo… 🤭
1 Go to commentsAn on field red (aka a full red) in SRP must surely carry a bigger suspension than a red card given by the bunker as that carries a 20 minute team punishment. Had Damon Murphy abdicated his responsibility as a ref and issued both Drua players a yellow, which would have been upgraded to a 20 minute red by the bunker, that would have killed Australia and New Zealand’s push for the 20 minute red to be trialled globally from July this year.
11 Go to commentsEver so often you all post a Danny Care story that isn’t the announcement that he has finally re-signed for one more, victory tour season at Quins and I’m just like, “well you fooled me again!” My absolute favorite player ever, we need to make his final year at the Stoop (and Twickers) official already. I know he supposedly snubbed France but I won’t feel better until he signs.
1 Go to commentslate hit what late hit it wasn’t at all late and can clearly see he was committed before the tackle
4 Go to commentsChristian Lio -Willies 2 try perfomance was a standout. As was captain Scott Barrett. Up front was where the boys won it.They are a great team and players. Fantastic Crusaders , you can keep going.
3 Go to commentsI don't know how the locals feel about that? I guess if you call yourselves the Worcester Wasps that might be appease. But really we need more teams in the Premiership in my view so they are not padding it out as they are at the moment. It might curtail so many players going abroad as well
5 Go to commentsNZ 😭😭😭is certainly rivaling England for best whingers cup!😭😭😭 !!!
30 Go to commentsYup. New Zealand won 3 out of 10 world cups played. SA 4 out of 8 attempts 30 Vs 50 per cent.🤔🤔
30 Go to commentsShould've done this years ago. Change Saturday kick off times to around 11am. Up and off and back home before 3pm, limit travel time too. Allows players to actually do something else with their Saturday that's family oriented or being rugby fans they could ‘watch’ pro rugby. Increases crowds etc. How can anyone that enjoys grassroots and pro rugby have to choose between the two on Saturdays?
9 Go to commentsI bet he inspired those supporters just as much.
1 Go to commentsBen Smith Springboks living rent free in his head 😊😂
67 Go to commentsGood to hear he would like to play the game at the highest level, I hadn’t been to sure how much of a motivator that was before now. Sadly he’s probably chosen the rugby club to go to. Try not to worry about all the input about how you should play rugby Joey and just try to emulate what you do on the league field and have fun. You’ll limit your game too much (well not really because he’s a standard athlete like SBW and he’ll still have enough) if you’re trying to make sure you can recycle the ball back etc. On the other hard, you can totally just try and recycle by looking to offload any and everywhere if you’re going to ground 😋
1 Go to commentsThis just proves that theres always a stat and a metric to use to justify your abilities and your success. Ben did it last week by creating an imaginary competition and now you did the same to counter his argument and espouse a new yardstick for success. Why not just use the current one and lets say the Boks have won 4 world cups making them the most successful world cup team. Outside of the world cup the All Blacks are the most successful team winning countless rugby championships and dominating the rankings with high win percentages. Over the last 4 years statistically the Irish are the best having the highest win rate and also having positive records against every tier 1 side. The most successful Northern team in the game has been England with a world cup title and the most six nations titles in history. The AB’s are the most dominant team in history with the highest win rate and 3 world cups. Lets not try to reinvent the wheel. Just be honest about the actual stats and what each team has been good at doing and that will be enough to define their level of success.
30 Go to comments