Wasps granted more time to fix financial mess while Worcester brace for worst
- Wasps file second notice of intention to appoint administrators
- Worcester face high court date on Wednesday
Wasps have bought more time in their bid to lift the financially stricken club out of crisis by filing a second notice of intention to appoint administrators.
A statement issued by Wasps Holdings Limited revealed that talks are at “a relatively advanced stage” with possible investors in the face of a winding up order from HM Revenue and Customs for £2m in unpaid tax.
The Premiership club is also struggling to repay the £35m bond that was raised to help finance their relocation from High Wycombe to Coventry in 2014 that was due in May.
Worcester have been placed into administration and face liquidation on Wednesday because of an action brought by HMRC. Wasps are desperate to escape the same fate.
“A second notice of intention to appoint administrators has been filed to allow negotiations on securing its long-term future to continue and to protect the interests of the group,” a spokesperson for Wasps Holdings Limited said.
“Since filing the original notice of intention on September 21, a number of additional potential investors and funders have come forward.
“Discussions are now at a relatively advanced stage and we remain hopeful of securing a deal that will allow the group, and the entities that sit within it, to move forward.
“We would like to thank all stakeholders for their engagement during this process and in particular the constructive support and approach provided by the Rugby Football Union and Premiership Rugby.
“This will continue to be vitally important as negotiations with interested parties proceed and we remain in regular dialogue with both organisations.
“While the financial circumstances facing the group are extremely challenging, we remain optimistic about a positive outcome and will keep our players, staff, supporters, partners, bond holders and suppliers updated as this process moves forward.”
Failure to secure the finance needed to prevent administration could result in automatic relegation from the Premiership.
However, the Rugby Football Union has the discretion to reduce or waive any sanction if the insolvency was deemed to be beyond the control of the club, including in the event of a pandemic.
Worcester face an exodus of players from Sixways this week with a hearing at the high court due on Wednesday.
HM Revenue and Customs is pursuing the Warriors for unpaid tax in the region of £6m and is to press ahead with the winding up petition knowing the club is in no position to clear the debut.
While Worcester are in administration, the company that holds player and some staff contracts – WRFC Players Ltd, a subsidiary of WRFC Trading Ltd – is still operational and is the subject of HMRC’s action.
Unless the high court opts for an adjournment, WRFC Players Ltd will be wound up in a move that will see the contracts terminated.