Finance

Worcester Warriors to enter administration amid financial woes

Premiership rugby union team Worcester Warriors has been placed into administration and suspended from playing after failing to provide the Rugby Football Union (RFU) with evidence of insurance cover, availability of funds to meet its monthly payroll, and a credible plan to take the club forward.

The club confirmed yesterday (Monday) that WRFC Trading Limited, which owns the Warriors, has asked the Department for Culture, Media and Sport to place the club into administration.

The RFU has suspended the Warriors from all competitions, including the Premiership, Premier 15s, U18s Academy Cup and Allianz Cup with immediate effect.

Worcester said that negotiations with possible investors have not led to the “critically-needed” funding, and administration is seen as the best solution to safeguard the interests of the business and ensure the best chances of a solution that saves the club.

Worcester is hopeful that entering into administration will help bring forward interested purchasers who may be able to preserve the club.

Warriors owners Colin Goldring and Jason Whittingham said: “We are grateful to DCMS and Sport England as the COVID-19 loan Programme Manager for accepting our request to place the club into administration.

“Both the club and DCMS will continue to coordinate efforts to find a rescue for the club if there is any possibility of it being saved. The administrators will assess any rescue options for some or all of the business as and when offers are made, while ensuring public funds are protected.”

RFU chief executive Bill Sweeney added: “We hope a buyer can be secured to allow Worcester Warriors and The University of Worcester Warriors to return to professional league rugby. While it is the responsibility of each business owner to manage their individual finances, we will look at learnings from this situation to see what regulation can be put in place to provide all parties with more financial transparency.

“Rugby is a relatively young professional sport and it has been widely recognised that clubs have been facing financial challenges even before COVID.

“Successful professional leagues are vital for the wellbeing of the whole game. They inspire current and future players, delight fans by showcasing high skill levels and the exciting nature of our game. This is why it is so important that we continue to work with Premiership Rugby to improve the structure, governance and business model of rugby union in England.

“The RFU will continue to support community rugby in Worcester and is fully committed to ensuring local academy opportunities are provided for pathway players.”

It emerged last week that Worcester and fellow Premiership club Wasps were facing heavy sanctions including possible relegation and suspension over their respective financial crises.

Wasps said that it had begun the process of going into administration due to the threat of HM Revenue & Customs action over unpaid tax.

RFU regulations state that a club that enters administration during the season will be relegated for the following campaign as it is classed as an insolvency event, although the union is able to waive or amend sanctions if the event is not deemed to be the club’s fault.

The RFU had given Worcester until 5pm yesterday to provide evidence of insurance cover, availability of funds and a plan to take the club forward, but it was unable to do so.