Now now Sam don’t let your bitterness creep in - it was only a lighthearted comment. I should ask - what do you think the natural consequence is if Wasps did go pop. Your owners don’t want the stadium. The council don’t. You’d be back on the phone to Northampton/Birmingham/Burton.
If it is just because of the debt burden, as opposed to be able to fund the daily operations, there's a good chance the administrator sells the club for a price that means it can continue as a going concern and the secured creditors walk away with whatever they can. This has to be a better deal than liquidating the assets because, to be brutal, who is going to buy the players at "market value" and what is the Wasps brand worth as a standalone entity?
I’m not sure there would be a lot left after the bond holders have taken what was offers as security - basically everything including proceeds from sale of P shares.
Taken from the bonds prospectus -
intentionally deleted to save space
Apologies, I obviously didn't make my point clearly.
There seems to be an expectation in some quarters that if Wasps "go bust", that is go in to administration, they will be immediately shut down, the Rugby team disappears and CCFC get to be sole users of the stadium.
If they go in to administration, the point I made, the courts will protect the business while the administrator tries to find a solution that satisfies the creditors and keep the business running. At this point the bondholders are just another creditor, albeit a senior one who I agree will likely get most of the proceeds when the administrator either sells the business or liquidates it. There is a ranking of debt seniority, with Wasps Holdings shareholders being at the very bottom, as it should be.
Of course there are circumstances where they would be immediately shut down, the players and staff sent home and all operations stopped*: if the cash flows are obviously not enough to cover day to day operations and don't look like they ever will and the financial situation will only get worse, but nobody has said that is the case and if that is the case the Directors are currently trading fraudulently, unless they have made personal pledges, AIUI.
*I've been in that situation, receiving the (expected) call from the administrator as I sat in Heathrow airport on the way to see a client, its quite a brutal process and if it happened someone would in to the business and tell everyone to go home, or more likely they'd receive texts telling them not to come to work because it would happen at 6am.