English rugby in turmoil with Wasps near bankruptcy

The financial crisis gripping English rugby worsened on Wednesday when Wasps, one of the country’s most famous clubs, said it was likely to go into administration due to debt.

This comes a week after another top flight club, Worcester Warriorshas been placed in compulsory liquidation because it is being prosecuted for unpaid tax.

Both teams would automatically be relegated to the second-tier Championship for going into administration – a form of bankruptcy protection, according to Rugby Football Union regulations.

Wasps, two-time European champion and six-time English champion, has been a fixture in the Premiership since the competition began 25 years ago and featured some of England’s best players like Lawrence Dallaglio and Simon Shaw. His current squad includes a number of England internationals, including Jack Willis, Joe Launchbury and Jacob Umaga.

Wasps have withdrawn from their Premiership game against Exeter which was scheduled for Saturday.

The club said it had “insufficient liquidity at the moment to continue to fund its operations” until a solution could be found to secure its long-term financial future.

Wasps are in debt for 35 million pounds ($38.65 million) resulting from their move to Coventry in central England from London in 2014. This debt must be repaid or refinanced and the club have sought to appeal to insolvency experts to help them solve their financial problems. .

“However,” said a statement from Wasps Holdings Limited, “it has become clear that there is unlikely to be sufficient time to find a solvent solution for the group companies, and it is therefore likely that they will enter into administration in the coming days with a view to concluding agreements shortly thereafter.

Wasps said it would continue to seek new investments “until the very last opportunity”.

“Although times are difficult,” the club said, “we remain confident that new owners will be found who will enable the clubs and group businesses to move forward.”

Wasps also has a women’s rugby team and a netball team which will be affected by the financial problems, which have been exacerbated by the shutdown of rugby during the pandemic which has hit all clubs in the pocket and has forced the UK government to intervene with a rescue plan.

Worcester players and staff had their contracts terminated due to its financial problems, with the club owing the UK Revenue Authority around £6 million ($6.8 million).

Owners Colin Goldring and Jason Whittingham have been accused of stripping assets from the Warriors, whose men’s side have been in the Premiership since 2015.

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