Always a Wasp

Author Topic: BB Breaking - Announcements  (Read 15742 times)

Andywasp50

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Re: BB Breaking - Announcements
« Reply #120 on: October 19, 2022, 05:43:06 PM »
https://www.bbc.co.uk/sport/rugby-union/63317864

Baxter’s been putting the boot in today and he seems to be the most outspoken of anyone outside of PRL and the RFU. I always thought he was a decent bloke, but I’m getting a bit bored that he’s nominated himself as spokesman for the clubs. Even Saracens have respectfully kept their counsel.

It would be good if someone reminded him and his club that whilst they are one of the few operating in the black, there have been musings in the past between their extremely rich owner and the rather tight link between his business interests, sponsorship of the club and the fact that chiefs never have any debt.

He has a point though; Clubs that have a way to effectively wipe their debts leaving creditors losing out but keeping their centralised revenues have a competitive advantage.  But it's a bit rich as it's what Saracens have effectively done with Wray writing off his debt and, although it's claimed otherwise, it appears to be what Tony Rowe has done via SWComms with Chiefs over the years.

Importantly, the difference is, they did it out of their own pockets, rather than inadvertently screwing over supply chain partners.  We'll see how Saracens finances pan out with their diversifying of income streams through different uses of StoneX

Baxter has quite a lot of points and it seems everyone in rugby is now entitled to his opinion. The bottom line is though his point is valid, it's not for him to be publicly pushing an agenda and acting as the Premiership club's spokesperson. He's in a very fortunate position given the backing of Rowe and to me, his pushing for exclusion of the P share for us and the reduction of the league to 10 clubs is elitist, graceless and smug given two clubs misfortune. Perhaps we'll end up with Exeter and saracens playing each other every week to keep him happy.

Shugs

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Re: BB Breaking - Announcements
« Reply #121 on: October 19, 2022, 05:50:50 PM »
I think what bemuses most is that the 11 seem to be fiddling whilst Rome burns. Baxter is absolutely right that you can’t have teams writing off debt Willy nilly but I think we’re beyond that. They seem oblivious to the fact that the whole league is in danger of becoming a sham. Two or three more go - are they still going to say “rules is rules”. The game is at crisis point. Flexibility is needed to rescue it. Something like allowing Wasps and Worcester to keep the p share but not get a share of the revenue while in the Champ. That would make a huge difference to investors who at the moment have a 10-20m layout just to buy the right to be in the prem. You’re then helping teams exist. But, as usual they won’t do anything and will only stir into life when they are down to 8 or 9.

Westy68

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Re: BB Breaking - Announcements
« Reply #122 on: October 19, 2022, 05:53:56 PM »
I must admit I think Baxter is right, we totally messed up our finances, we gave ourselves a massive debt and put everything on black and it was red.

I'm finding it very hard to understand that we could have got debts of over £100m, you can't get away with such poor mismanagement and not expect to pay the ultimate price with such a high level gamble.

Originally I was upset with the PL but we can't get away with what we did and that should apply to every club
« Last Edit: October 19, 2022, 05:57:24 PM by Westy68 »

WonkyWasp

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Re: BB Breaking - Announcements
« Reply #123 on: October 19, 2022, 05:58:30 PM »
They will begin to worry when it affects or appears to be about to affect them personally. Until then  .  . . . .

Bloke in North Dorset

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Re: BB Breaking - Announcements
« Reply #124 on: October 19, 2022, 06:11:13 PM »
Listening to Stephen Vaughan on the rugby pod, If there is to be wasps team next year it is highly likely that we will still be playing at the CBS. Really interesting listen….

Chose his words about Derek very carefully I thought

I haven't listened, but his interview in the Cov Tel was very pointed indeed.  I was always under the impression that the CEO was where the buck stopped, but it must be nice for him to have a convenient scapegoat to pass all the blame onto.
I've just listened and my takeaway was that he was brought in to run the sports business and that Dereck was hands off. Without going back through the press I think that was made clear when he was appointed.

I know he's talking his own book, but taking him at face value he made lots of changes to the way the business was run and even turned an operating profit, but the debt overhang was too much in the end.

He didn't hang Dereck out and pointed out Dereck had kept on funding the business. During his discussion on the business model he made it quite clear that the problem is that it relies on very wealthy owners and the cost to those owners is rising. He said something of the lines of funding clubs has gone from £1m  to £4 to £5m and the fun goes out of it for owners who are all very high net worth people and have to think about their families.

The only note of bitterness I detected was when he said that 5 minutes ago 14 clubs was the solution and now its 10 clubs.

He said he's working for free to try to put a Championship club together and a number of players have said they want to be involved, some of them senior. He also said that even internationals are getting fairly poor offers, 50% of their current package.

Overall I thought he was open and candid within the bounds of respecting confidentialities and individuals and it is worth a listen because he has some for interesting thoughts on how the game is run and where it goes from here..
 

Lwasp

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Re: BB Breaking - Announcements
« Reply #125 on: October 19, 2022, 06:23:38 PM »
I'm finding it very hard to understand that we could have got debts of over £100m, you can't get away with such poor mismanagement and not expect to pay the ultimate price with such a high level gamble.

I do wonder what the true number is and to whom? Things we know (or think we do at any rate):-

Bonds                  £35m
Covid Loan           £15m
HMRC Tax             £2m
DR Director Loan   £20m

That gets me to £72m. Is there really another £30m owed somewhere, if so where? It really doesn't matter how much debt you have as long as you can service it. I don't really think the DR loan was a problem, the HMRC £2m clearly was. The bond was, I believe, always planned to be rolled over in a refinance since we didn't have the enormous profits coming in to save up and repay it. Wasps have failed because of the failure to refinance the bonds. if we had would HMRC have got twitchy and called in their debt?

Funny thing is the £35m went mostly to pay for the stadium (£22m odd did, £15m the debt to CCC and £7m set aside for interest payments), yet Wasps Holdings are in administration and the stadium isn't. The reason we moved to Coventry was to own our own home (long lease same as ownership before the pedants point out we would never have "owned" it).

The more I think about it the more I think we should be angry that somehow just the dream of owning our own home has wiped us out. Wasps bought the stadium for someone else and it has buried them.

backdoc

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Re: BB Breaking - Announcements
« Reply #126 on: October 19, 2022, 06:28:39 PM »
Very astute, Lwasp. That is how it appears to me as well.

NellyWellyWaspy

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Re: BB Breaking - Announcements
« Reply #127 on: October 19, 2022, 06:32:35 PM »
I'm finding it very hard to understand that we could have got debts of over £100m, you can't get away with such poor mismanagement and not expect to pay the ultimate price with such a high level gamble.

I do wonder what the true number is and to whom? Things we know (or think we do at any rate):-

Bonds                  £35m
Covid Loan           £15m
HMRC Tax             £2m
DR Director Loan   £20m

That gets me to £72m. Is there really another £30m owed somewhere, if so where? It really doesn't matter how much debt you have as long as you can service it. I don't really think the DR loan was a problem, the HMRC £2m clearly was. The bond was, I believe, always planned to be rolled over in a refinance since we didn't have the enormous profits coming in to save up and repay it. Wasps have failed because of the failure to refinance the bonds. if we had would HMRC have got twitchy and called in their debt?

Funny thing is the £35m went mostly to pay for the stadium (£22m odd did, £15m the debt to CCC and £7m set aside for interest payments), yet Wasps Holdings are in administration and the stadium isn't. The reason we moved to Coventry was to own our own home (long lease same as ownership before the pedants point out we would never have "owned" it).

The more I think about it the more I think we should be angry that somehow just the dream of owning our own home has wiped us out. Wasps bought the stadium for someone else and it has buried them.

There will be other creditors, amounting to £15-20m

Wages, more to HMRC than that (the £2m was only was due at that point, not the total debt), interest on the bonds, unpaid bills at EPIC, trade creditors, all the ticket money coming back to ticket holders will leave the banks as creditors, which alone could be over £1m, it will add up very quickly.

Vespula Vulgaris

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Re: BB Breaking - Announcements
« Reply #128 on: October 19, 2022, 06:35:58 PM »
The idea that clubs can't wipe their debt and be free to carry on is ridiculous.

Rugby doesn't make money and so debt has to be got rid of one way or another. Being given a big wad of cash by a sugar daddy who wants to use you as a trophy to show his friends is no more honourable than wiping it through the courts.

In essence it's just reinforcing the idea that business cannot be part of rugby. They aren't making the sport more sustainable, they are making it less.
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Shugs

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Re: BB Breaking - Announcements
« Reply #129 on: October 19, 2022, 06:38:51 PM »
Very astute, Lwasp. That is how it appears to me as well.
Indeed. Although I do think it was done to sustain the rugby side. But there are some uncomfortable questions in there.

wasps

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Re: BB Breaking - Announcements
« Reply #130 on: October 19, 2022, 06:44:47 PM »
Why does the P share exist at all?
Why isn't it simply a case of "if you play in the prem you get a cut of the TV money for that season, otherwise you don't"?


It seems completely ridiculous (not to mention wholly unfair and unworkable) that a club could get promoted to the premiership and not be given a slice of the TV money.


Regardless of our status, that's a scam

Westy68

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Re: BB Breaking - Announcements
« Reply #131 on: October 19, 2022, 07:00:17 PM »
The PL are also to blame, how can you be head Of an organisation and allow your assets to be run in the manner that allows potentially 1/4 of them to go bust

Neils

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Re: BB Breaking - Announcements
« Reply #132 on: October 19, 2022, 07:04:53 PM »
Puzzled - CVC own 27% of PRL and have said nothing
Let me tell you something cucumber

bigad82

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Re: BB Breaking - Announcements
« Reply #133 on: October 19, 2022, 07:49:41 PM »
Puzzled - CVC own 27% of PRL and have said nothing
They were on mute when they owned F1.

InBetweenWasp

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Re: BB Breaking - Announcements
« Reply #134 on: October 19, 2022, 08:12:05 PM »
The idea that clubs can't wipe their debt and be free to carry on is ridiculous.

Rugby doesn't make money and so debt has to be got rid of one way or another. Being given a big wad of cash by a sugar daddy who wants to use you as a trophy to show his friends is no more honourable than wiping it through the courts.

In essence it's just reinforcing the idea that business cannot be part of rugby. They aren't making the sport more sustainable, they are making it less.

This feels like a particularly overzealous viewpoint.  I don't think the likes of Nigel Wray, Cecil Duckworth funded their Clubs to use them as trophys to show off to their mates, it was for the love of their Rugby Club.  I've no idea about Lansdown/Craig or how much either have put into Bristol/Bath.

I'm gobsmacked to read you think that deliberately leaving creditors to pick up the tabs of your spending in order for you to be more competitive again is the same as personally funding/writing off debts to a club as a wealthy owner.

I totally agree with you that Rugby is fundamentally broken as a business model and there needs to be some sort of a reset but think that to suggest Clubs should be allowed to rack up a load of debt, then shed it via administration only to phoenix up again is wide of the mark when it comes to be an acceptable way to run a club.

There needs to be some sort of governance/jeopardy to stop this from being done deliberately.

For us, it doesn't seem like this was being done for personal gain or to game the system.  The numbers were just (very) wrong.