They would wouldn't they!

[Neils]

Premiership clubs want to defer repayment of ?100m in Covid loans https://mol.im/a/12296669 via https://dailym.ai/android

[NellyWellyWaspy]

Premiership clubs want to defer repayment of ?100m in Covid loans https://mol.im/a/12296669 via https://dailym.ai/android

Can
Road
Kicking
Down

What, is there an elephant where?

Now or 10 years from now, the HMRC (us) will never see that money again. Whether or not it is paid back when it is currently due might delay the inevitable by 1 or 2 years at most. Those other debts are piling up faster than an avalanche.

My guess is that this story sort of confirms that more than one club is, as I predicted during these no cash income months, now out of cash to pay any debts, and that, in the background, HMRC is again knocking on the doors of the courts. Could it be that one or two clubs won't even make it to the first game?

Each time one goes under, the remaining few have to buy back that golden share, and I doubt they can afford to do that either. Any takers on a bet that the administrator for LI has not received any money for that yet?

[Rossm]

Lance Bradley steps down (yesterday) as CEO of Gloucester Rugby with immediate effect. Coincidence? Or seeing which way the wind is blowing?

[Rossm]

Joe Marlar comment:

[NellyWellyWaspy]

Joe Marlar comment:

That sort of suggests 6 clubs are struggling, or at least not campaigning for the cap to rise.

If those four win the debate, that means 3 of the 6 are sitting on the fence, and 3 are voting to keep it lower. So, you have:

Gloucester 3
Quins -
Saints -
Tigers 2
Falcons 1
Sale -

Above are those 6. Numbered are the 3 most likely for the lower cap, and most likely in trouble, I think in that order  (1, 2, 3). It is quite worrying that Lance has stepped down so suddenly.

All it takes is for the money man to wake up one morning and say, as Mick Crossan did, 'Enough is enough, I'm out.' No point in looking for a buyer, Wasps, Worcester and Irish did that, they turned every rock over, searched the jungles and desert islands. As soon as the decision is made in that owner's mind, the wages do not get paid. There is every chance that the final demand from HMRC has been on their desk for days, if not weeks. I think we would have heard if some wages had not been paid in June, but that July payment is only two weeks away. If they did not make the HMRC payments last month, and maybe not in May, the Winding Up petition will be in Court over the next couple of weeks.

Always it is the wages that are the last thing not to get paid. Trade creditors get hit first, then the tax man, then the utilities and finance companies, then the staff. With a business like rugby, you would get little visibility of problems because there are no games right now. Senior staff are the only ones people watch. Or a player still under contract suddenly gets released to move for no obvious reason.

And, to quote Status Quo, it goes, 'Down, down, deeper and down.'

[westwaleswasp]

Right now the best chance for Wasps to ever exist again at a pro level would be for clubs to go bankrupt.
From an English rugby pov, the best thing would be  the same. Those 4 clubs are a cancer, the sooner they have nobody to play, the better. I am sure their owners envisage a Euro league with them sitting pretty. I cannot wait to watch them be told to fuck themselves by the French and Irish. Then, finally, they will be rulers of a dead league with nobody to play. And yes, I would rather the sport burn if it gets those selfish cheating scumbags out of our sport.

[Brandnewtorugby]

But Covid loans weren't the reason three clubs went bust...
Moves like this have a tiny chance of changing anything, but make creditors rush to call in any debts they can. It's like a slow motion car crash, they have had years to sort this out and failed catastrophically. Who would give any credit terms to a professional rugby entity now? Who would buy into a club? Formats, rules and league structure announcements change so often it isn't even clear what you would be buying.

[NellyWellyWaspy]

But Covid loans weren't the reason three clubs went bust...

No, but paying them on time is causing major cashflow problems. Organisations do not go 'bust' because they owe money. They go bust because they run out of cash. That they have been losing money hand over fist for years means they cannot borrow money. The rich owners kept putting money in the cookie jar, and everybody closed their eyes and pretended to be happy.

But, when things get tough, when you run out of cash, as I suspect 3 of the clubs have, the first organisation to go to the option of a winding up order is always HMRC. The fact that HMRC are acting collection agents for the DCMS, is the problem. The PRL are not actually asking for the Covid loans to be extended. They are asking DCMS to tell HMRC not to pursue them for late and/or missing repayments. Most will have long since negotiated extending these repayments (DCMS has been very accommodating and allowing this), but, one club after another is failing to meet even the renegotiated terms. And DCMS will not extend again.

And so, the clubs file for administration because they do not have the cash to pay HMRC off, to keep them at bay.

So, no, the Covid loans will not be the cause, but they will be the means. It amounts to the same thing, and certainly small minded journalists would be utterly unable to grasp the concept, and so we see the Daily Fail publish articles like this.

In reality, published as it is today, will cause bored rugby journos to go trawling discussion boards, like this one. The light bulb will go off. The 10 clubs are not asking for the Covid loans to be extended. 3 of the clubs can't pay the next installment. They are out of cash. Suddenly, their interest is piqued. Smelling blood, they start lifting stones. Talking to people over a pint or G&T, off the record. Looking for a chink in the silent armour. And they will find it, and we will see articles by tomorrow in the Sunday papers. 'Nameless' club is in deep trouble they will say. Likely to fold before the season.

The creditors of those 3 clubs, the players, will start asking very pointed questions. Asking their owners not for assurances they will be paid. Those were made by the last three owners of clubs to go bust. No, this time they will ask for written personal guarantees. The sort of thing the bank asks you to sign when you borrow money to buy a car. And they will not get those guarantees. They will only get oily smiles, platitudes, warm words. All of which are meaningless. And then they quietly tell their friends things are not looking good. They start looking for new clubs, or trigger retirement plans early. Each time the wheels came off a club this last season, each successive club went under faster once the talk started. The next one, no one will believe, 'We have a buyer ready and waiting, just about to sign.' They know that will be a lie. The discussion boards debates, when they start, will be short and terminated by the club going in to administration.

The ideal, perfect league of 10 becomes 9, then 8, then 7. Will that stop the rot? I do not think so. I think we are heading towards a 4 club league; Bath, Bristol, Exeter and Sarries. But Steve Lansdown is said to be getting bored with funding Bristol. Rich folks and their playthings.

OUR GAME. OURS. The one we played when we were young (and not so young). OURS. Not the RFU's, not the PRL's. OURS. Stolen, ruined, destroyed.

[WonkyWasp]

When I said (several months ago) that the Prem would probably end up with just 4 teams I really didn't mean it.  Now tho' it might well be even fewer.   Sa??acens playing themselves.

[Neils]

When I said (several months ago) that the Prem would probably end up with just 4 teams I really didn't mean it.  Now tho' it might well be even fewer.   Sa??acens playing themselves.

Playing with themselves??

[Rossm]

I think you are being just a tad harsh on Chris Foy, Nelly. He's a sound rugby journo.

[WonkyWasp]

You never know, Neils.  Nor would you want to know.

[DGP Wasp]

When I said (several months ago) that the Prem would probably end up with just 4 teams I really didn't mean it.  Now tho' it might well be even fewer.   Sa??acens playing themselves.

Playing with themselves??

Bunch of w.....

[Vespula Vulgaris]

If those four win the debate, that means 3 of the 6 are sitting on the fence, and 3 are voting to keep it lower. So, you have:

Gloucester 3
Quins -
Saints -
Tigers 2
Falcons 1
Sale -

Above are those 6. Numbered are the 3 most likely for the lower cap, and most likely in trouble, I think in that order  (1, 2, 3). It is quite worrying that Lance has stepped down so suddenly.

All it takes is for the money man to wake up one morning and say, as Mick Crossan did, 'Enough is enough, I'm out.' No point in looking for a buyer, Wasps, Worcester and Irish did that, they turned every rock over, searched the jungles and desert islands. As soon as the decision is made in that owner's mind, the wages do not get paid. There is every chance that the final demand from HMRC has been on their desk for days, if not weeks. I think we would have heard if some wages had not been paid in June, but that July payment is only two weeks away. If they did not make the HMRC payments last month, and maybe not in May, the Winding Up petition will be in Court over the next couple of weeks.

FWIW I heard a credible rumour recently that Quins were looking for money.

[WonkyWasp]

I'll start supporting them.  That should do it.  Kiss of death.