Wasps teeter on the brink as Premiership club suspended
One of the Premiership Rugby’s most successful and historic clubs has become the second English side within a month to be suspended from the top flight after Wasps announced that they would likely fall into administration in the coming days.
The Coventry-based outfit today said that they had withdrawn from their Premiership fixture against Exeter Chiefs, originally set for Saturday afternoon, due to long-running financial problems and were this evening suspended from the Premiership by the Rugby Football Union.
The two-time European champions and five-time domestic title holders could face a similar fate to fellow Midlands side Worcester Warriors, who were suspended from the league after falling into administration over significant debts before being expelled from the English Premiership and relegated into next season’s Championship.
Wasps initially filed a notification to the High Court on 21 September stating their intention to appoint administrators – a move to be proactive about their financial situation and open up the possibility of external investment.
On 4 October, Wasps Holdings Limited issued a second notice to the same court outlining how the club had not found viable solutions to their lack of liquid assets. Yesterday the club confirmed they were likely to fall into administration in the coming days.
“Since filing a notice of intention to appoint administrators on 21 September, we have been working tirelessly to secure the long-term future for Wasps Holdings Limited and all of the organisations and clubs that sit within the group,” a statement said.
“Negotiations to secure deals that will allow the men’s and women’s rugby teams, netball team and the arena and associated business to move forward are ongoing.
“However, it has become clear that there is likely to be insufficient time to find a solvent solution and it is therefore likely that they will enter into the administration in the coming days with a view to concluding deals shortly thereafter.”
Wasps left High Wycombe for Coventry in 2014 in a move financed by a £35m bond scheme. The deadline for the repayment of those bonds came and went earlier this year and the club were looking for new funding to refinance that debt.
As part of the move, Wasps acquired a 250-year leasehold to the stadium, now the Coventry Building Society Arena, which they now share with Championship football side Coventry, who are tenants.
Coventry County Council has the freehold to the arena.
There have been reports of a number of bids for some or all of the business in recent weeks with each declaring an interest in slightly different aspects of the Coventry outfit.
Former chief executive David Armstrong is said to be spearheading a bid for the club and the stadium alongside Terminum Capital. Former Newcastle United owner Mike Ashley has held talks with the club over a takeover.
The retail tycoon is said to have previously offered to refinance the club’s £35m of bonds against Wasps but current owner Derek Richardson is thought to want around £50m for the club.
The NEC Group, who own conference centres, is said to want just the arena side of the business and is backed by private equity firm Blackstone.
There are options on the table but it appears the club’s move from London to Coventry in 2014 has not stood the test of time – and the Premiership could be about to lose a 155-year-old institution of English rugby in the latest of a long line of issues facing the sport at the moment.