Wasps in the mire - now in administration

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TTRITH
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Re: Wasps still in the mire

Post by TTRITH »

Rugbygramps wrote: Sat Jul 02, 2022 9:20 am
TTRITH wrote: Sat Jul 02, 2022 9:16 am I hope Wasps don't go under. There's already been a number of Premiership players released this year without clubs, and Wasps going bust would only increase that. You would imagine that the league will drop back to a 12 team league, a re-work of the fixtures and hopefully have rest weeks during the AIs and 6Ns.

Would hit the other 12 clubs in the league too. Thats one less matchday revenue coming in.
It is a fair point but should a company that isn’t financially viable be allowed to continue. I would certainly hope they aren’t given any central funding given all the clubs that are in trouble all the way down the leagues.
No, I agree. I'd far rather they find a workable solution.

You do have to remember that the RFU don't care about teams in lower leagues, a team going out of business in the Championship would barely make a negative ripple, but Wasps going out of business may actually hit the back page. And thats bad press.
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Re: Wasps still in the mire

Post by Rugbygramps »

TTRITH wrote: Sat Jul 02, 2022 9:24 am
Rugbygramps wrote: Sat Jul 02, 2022 9:20 am
TTRITH wrote: Sat Jul 02, 2022 9:16 am I hope Wasps don't go under. There's already been a number of Premiership players released this year without clubs, and Wasps going bust would only increase that. You would imagine that the league will drop back to a 12 team league, a re-work of the fixtures and hopefully have rest weeks during the AIs and 6Ns.

Would hit the other 12 clubs in the league too. Thats one less matchday revenue coming in.
It is a fair point but should a company that isn’t financially viable be allowed to continue. I would certainly hope they aren’t given any central funding given all the clubs that are in trouble all the way down the leagues.
No, I agree. I'd far rather they find a workable solution.

You do have to remember that the RFU don't care about teams in lower leagues, a team going out of business in the Championship would barely make a negative ripple, but Wasps going out of business may actually hit the back page. And thats bad press.
You are right of course. I was referring to teams lower than the championship too
Scott1
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Re: Wasps still in the mire

Post by Scott1 »

Hope they don’t go out of business! Too many job losses,I couldn’t live with that in this current climate
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Re: Wasps still in the mire

Post by Ian Cant »

I too don’t want to see Wasps go under but the writing was on the wall when they moved out of London which destroyed their fan base. They’d never had great support but the 6-7000 that attended matches in London were a very passionate and loyal bunch. Talking to some of the fans at Twickenham they said they no longer supported Wasps due to the ridiculously long round trip they had to make for so called “ home games at a football ground!”
Although I go to watch Tigers at The Ricoh I find the ground soulless and provides a similar problem for Wasps as Irish had at Reading. Irish eventually saw sense!
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Re: Wasps still in the mire

Post by TigerFeetSteve »

https://archive.ph/FjsBQ

This article in the Telegraph does not seem to be looking good for Wasps...
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Re: Wasps still in the mire

Post by Rugbygramps »

TigerFeetSteve wrote: Mon Jul 11, 2022 11:34 am https://archive.ph/FjsBQ

This article in the Telegraph does not seem to be looking good for Wasps...
I’m no financial expert but that sounds pretty dire. If they can’t make the required Bond repayments does that mean they go out of business
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Re: Wasps still in the mire

Post by tigerburnie »

It would seem Wasps are made up of more than one business, the rugby club leases the ground from another part of the Wasps business, the rugby club could end up with no money pay wages etc if the other parts of the company go bust, or at least that is what I read. That would I believe see the rugby club ejected from the league something like what happened to London Welsh and they would have to start again from the bottom.
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Re: Wasps still in the mire

Post by wigworth »

Rugbygramps wrote: Mon Jul 11, 2022 11:42 am
TigerFeetSteve wrote: Mon Jul 11, 2022 11:34 am https://archive.ph/FjsBQ

This article in the Telegraph does not seem to be looking good for Wasps...
I’m no financial expert but that sounds pretty dire. If they can’t make the required Bond repayments does that mean they go out of business
In general on corporate bonds if bond payments cannot be met, whether that be either the interest payments or the principle amount (£35 million) which seems to be the case for Wasps then the company will generally file for bankruptcy if alternate funding cannot be found. A liquidation of their assets will occur with the proceeds of the sale going to the bond holders of an amount up to the principle, if there are any funds leftover after the bondholders have been repaid then this would go to the equity stakeholders. As tigerburne points out due to Wasps being made up of several different businesses depending on how they are structured the actual rugby club might be able to survive and the other parts are liquidated.

From the article it seems like Wasps would still be able to and are willing to make the interest payments even beyond the maturity date, so they are not completely cash strapped but just lack the full £35 million. If they are able to prove that they could in fact continue making these interest payments then I would guess there would be a good chance they could secure some alternate funding to repay the £35 million.
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Re: Wasps still in the mire

Post by Offside »

That would depend on the interest rate they can get. The original one is 6%, I think. As they have not been able to pay back and interest rates have also gone up it could be that there is no appetite for the risk amounts lenders at a rate Wasps can afford or afford and accumulate cash to pay the capital off at the end. Rolling over debt is very common but the business case needs to be good enough to support it. They may be using some of the cash that could pay off some of the capital to continue to pay the interest. That would not provide any future lender with assurance
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Re: Wasps still in the mire

Post by wigworth »

Offside wrote: Mon Jul 11, 2022 1:54 pm That would depend on the interest rate they can get. The original one is 6%, I think. As they have not been able to pay back and interest rates have also gone up it could be that there is no appetite for the risk amounts lenders at a rate Wasps can afford or afford and accumulate cash to pay the capital off at the end. Rolling over debt is very common but the business case needs to be good enough to support it. They may be using some of the cash that could pay off some of the capital to continue to pay the interest. That would not provide any future lender with assurance
I agree they would most likely be looking at 10%+ now on any further financing and without looking at their books I have no clue where they are getting their money from to make the payments and what value their actual assets could be valued at. I still think they may get finance though as £35 million in the bond market is not a great amount.
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Re: Wasps still in the mire

Post by TigerFeetSteve »

wigworth wrote: Mon Jul 11, 2022 2:31 pm
Offside wrote: Mon Jul 11, 2022 1:54 pm That would depend on the interest rate they can get. The original one is 6%, I think. As they have not been able to pay back and interest rates have also gone up it could be that there is no appetite for the risk amounts lenders at a rate Wasps can afford or afford and accumulate cash to pay the capital off at the end. Rolling over debt is very common but the business case needs to be good enough to support it. They may be using some of the cash that could pay off some of the capital to continue to pay the interest. That would not provide any future lender with assurance
I agree they would most likely be looking at 10%+ now on any further financing and without looking at their books I have no clue where they are getting their money from to make the payments and what value their actual assets could be valued at. I still think they may get finance though as £35 million in the bond market is not a great amount.
Do Wasps own a training ground? If not I'd say there's only two assets they have of real value
1 - The Stadium
2 - Premiership Shares

All other assests surely are small fry compared to a £35million outstanding payment.
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Re: Wasps still in the mire

Post by GB72 »

TigerFeetSteve wrote: Mon Jul 11, 2022 2:47 pm
wigworth wrote: Mon Jul 11, 2022 2:31 pm
Offside wrote: Mon Jul 11, 2022 1:54 pm That would depend on the interest rate they can get. The original one is 6%, I think. As they have not been able to pay back and interest rates have also gone up it could be that there is no appetite for the risk amounts lenders at a rate Wasps can afford or afford and accumulate cash to pay the capital off at the end. Rolling over debt is very common but the business case needs to be good enough to support it. They may be using some of the cash that could pay off some of the capital to continue to pay the interest. That would not provide any future lender with assurance
I agree they would most likely be looking at 10%+ now on any further financing and without looking at their books I have no clue where they are getting their money from to make the payments and what value their actual assets could be valued at. I still think they may get finance though as £35 million in the bond market is not a great amount.
Do Wasps own a training ground? If not I'd say there's only two assets they have of real value
1 - The Stadium
2 - Premiership Shares

All other assests surely are small fry compared to a £35million outstanding payment.
I am guessing the rugby operations and the Premiership shares are tied up in another company outside the bond. I could imagine a scene where a rich individual took control of the club and took them back down South and left the company with the bond and the stadium to go into liquidation.
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Re: Wasps still in the mire

Post by wigworth »

TigerFeetSteve wrote: Mon Jul 11, 2022 2:47 pm
wigworth wrote: Mon Jul 11, 2022 2:31 pm
Offside wrote: Mon Jul 11, 2022 1:54 pm That would depend on the interest rate they can get. The original one is 6%, I think. As they have not been able to pay back and interest rates have also gone up it could be that there is no appetite for the risk amounts lenders at a rate Wasps can afford or afford and accumulate cash to pay the capital off at the end. Rolling over debt is very common but the business case needs to be good enough to support it. They may be using some of the cash that could pay off some of the capital to continue to pay the interest. That would not provide any future lender with assurance
I agree they would most likely be looking at 10%+ now on any further financing and without looking at their books I have no clue where they are getting their money from to make the payments and what value their actual assets could be valued at. I still think they may get finance though as £35 million in the bond market is not a great amount.
Do Wasps own a training ground? If not I'd say there's only two assets they have of real value
1 - The Stadium
2 - Premiership Shares

All other assests surely are small fry compared to a £35million outstanding payment.
Possibly I have no idea what they value the stadium at as doesn't it also contain a hotel and casino? Also I would imagine anyone coming in to provide them with money now isn't going to do so without getting a cds on the business anyway.
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Re: Wasps still in the mire

Post by BigDan50 »

Let’s hope that Wasps can sort out their financial problems and remain a premiership club, we need Wasps to be a competitive team as to lose them would diminish the league in so many ways.
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Re: Wasps still in the mire

Post by Grannyman »

BigDan50 wrote: Mon Jul 11, 2022 3:21 pm Let’s hope that Wasps can sort out their financial problems and remain a premiership club, we need Wasps to be a competitive team as to lose them would diminish the league in so many ways.
I completely agree with this. During our tough times, and now with Bath and Wasps struggling, I still really look forward to those fixtures as much as yesteryear. Our rivalries add so much to the season, I wouldn’t want any of them to disappear.




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