Wasps 22 Discussion Threads

[mmoule] 12/7/2022 11:46

I am inclined to wait till 12th August to see what happens. Although I am not optimistic. However organising ourselves to get an Acceleration notice may be tricky, since the Trustee tells me "Unfortunately it’s not operationally possible to obtain a list of Bondholders from either us or the company.'

Not sure I believe that - but it tells you that no-one is going to be that helpful.

Why do small shareholders not trust the City I wonder?

[barondene] 12/7/2022 08:42

@bondholder But surely the cost and extent of the "stadium" development depends on what you include outside of a pitch and stands. Whatever that is should generate an income return commensurate with the cost. As SISU nor Warwick have disclosed what the planned development is envisaged its all speculation

What isnt speculation is the Arena in Coventry - it is built so the cost is irrelevant. What now is relevant is the annual net income from which the value as an investment and from that the borrowing value can be ascertained

[bondholder] 11/7/2022 23:00

I'm not throwing out numbers. There is plenty of data available on the construction cost of new stadiums. If anything 150m is conservative given the size and additional amenities. (casino,hotel,conference center,transport,parking)

[barondene] 11/7/2022 22:34

@bondholder

As you do not (as no one outside of the parties) know what the deal is at Warwick you cannot throw out numbers as you have done.

You are also assuming CCFC will get automatic right to the stadium which will depend on funding. Judging from WASPs current efforts that will not be likely

[bondholder] 11/7/2022 21:41

In 2020, both Coventry City and University of Warwick announced a new partnership to investigate the possibility of building a brand new stadium on land close to the institute's campus in the city.150/200m to new build or 35m to buy the existing stadium.This is not a difficult choice. CCFC spent a ton of money on failed litigation arguing it was worth 50m and tried to overturn the sale to Wasps.Of course CCFC will try to get the lowest price. Wasps want to retain the CBS stadium ownership/remortgage. There is also the possibility of a third bidder. Both clubs have to have a stadium.If the HSBC refinancing does not complete there are plenty of other possibilities.This is not an unsecured creditor situation. Don't panic.

[thincat1] 11/7/2022 16:49

@CesareBorgia

I think there are at least two things we can do. One is contact the Trustee with questions or suggestions to him or to the Issuer (see 636). The other is to organise ourselves with a view to getting the Trustee to issue an acceleration notice.

I've done the first. I am inclined to wait til 12 August before doing the second. There is a fair chance that we will get paid then; if we aren't, it would strongly suggest the Issuer is not acting in good faith (especially if they don't communicate more comprehensively), and I'd then start pushing the Trustee into action.

[cesareborgia] 11/7/2022 15:34

Does nobody want to answer my question?
Is there anything we as bondholders can do?

[cesareborgia] 11/7/2022 15:32

Nobody has answered my question. Is there anything as bondholders we can do apart from make posts on ADVFN?

[barondene] 11/7/2022 14:49

@bondholder

Why do you think "CCFC want it" nothing indicates that is the case

WASPS lose £10m a year - it would a gift that never stops taking!

Even if WASPS Holdings gets its handout from WMCA how will they get past next year?

If the Bondholders get paid then I understand they are not bothered - but it should be top of any lenders thinking

[bondholder] 11/7/2022 14:41

The question is how much

[bondholder] 11/7/2022 14:41

CCFC definitely want it

[bondholder] 11/7/2022 14:40

Stadium replacement cost above 150m

[bondholder] 11/7/2022 14:37

At least we are secured priority creditors. We rank above the banks etc

[dandigirl] 11/7/2022 14:06

It is the Trustee who has called default.

In the absence of a refinancing or an extension, interest is unlikely to be paid on-going.

Relisting unlikely given the default and the delays in filing accounts.

Just hope we receive repayment this time. Otherwise this has the potential to get mucky with only the lawyers winning.

[addition] 11/7/2022 12:34

They have said they are in default. But they have also said that they will pay interest on the bonds. So you could look on it as a perpetual bond until they make formal agreements with bondholders on a way forward. They may not need to if they refinance.

The removal from listing needs sorting out so that there is some sort of alternative exit route.

[dandigirl] 10/7/2022 19:50

Default is now a reality.

[cesareborgia] 10/7/2022 17:45

If as and when the default finally became reality do the bondholders have any recourse to Messers Ricahrdson and Eastwood as directors of the company?
If so what?
If not does this mean that the company and its directors can simply walk away from a £35 million debt and still enjoy their seats in the directors box at Wasps matches?

[dandigirl] 09/7/2022 18:42

From the Telegraph:

[addition] 07/7/2022 12:00

@ 135791113

It is not so much a default you might be after than access to information. Suppose there is an offer on the table that would get bondholders 100% of their money back but which would in some way be unattractive to the issuer.

Without being in the tent, how would you know any such offer existed?

[dandigirl] 07/7/2022 11:59

Thank you, thincat1. Update appreciated.

[thincat1] 07/7/2022 11:33

Thanks very much for all this information.

I've now spoken to Laurence Griffiths of US Bank, the Trustee. Main points:

1. A decision to issue an acceleration notice needs to be taken carefully; it's not necessarily in bondholders' interests. The Trustee isn’t in a position to judge what is best for bondholders, so generally doesn’t act without being instructed. However, there are circumstances in which the Trustee would be more likely to act unilaterally, for example if there was an attempt to put the issuer in administration.

2. The costs of enforcement don't necessarily need to be fully met or indemnified by bondholders before the Trustee acts on their behalf and could be recovered eventually from the issuer. The Trustee would take a view at the point of relevant instructions being given as to the extent of additional indemnity being required, based on an analysis of the specific situation and the nature of the instruction.

3. I said that the Issuer has missed some opportunities: not communicating more explicitly about what was happening, missing the 30 June deadline without adequate explanation, not including a statement from HSBC giving confirmation that they were moving towards refinancing, not explaining more about the remaining diligence matters and not announcing and explaining the delisting. This is making a difficult situation worse. Laurence agreed to phone the issuer and tactfully pass on ideas about they could improve their communication and thus reduce the risk of bondholder action. I will email him my questions and suggestions today; others may wish to do so too ([e-mail]).

4. Communication to bondholders isn't working, partly because messages via Euroclear and Clearstream don't get processed by platforms and brokers. Laurence suggests we ask our platforms to sort this out, but is willing to send communications directly to bondholders who send him their email addresses. Formal corporate actions requiring a response would go through the formal channels.

5. On delisting, he thinks this may have been an automatic LSE action on the date on which the bonds should have matured, rather than a decision of the Issuer. He agrees that the re-establishment of a secondary market is helpful and to this end he has asked the Issuer to pursue re-instatement of the listing.

I emerged better informed and reassured that US Bank are behaving reasonably, though one should always retain some caution dealing with persuasive City folk. As Laurence pointed out, he cannot advise bondholders.

[135791113] 06/7/2022 20:30

Can it be listed when they are in default? I don't know, but don't see how it can be with redemption date of May 22, which has past.

The Trustees job is to work in the interest of bondholders, which will include giving Wasps time to refinance if possible. Far better to give them time and refinance at 100% than push for the default and have them redeem lower, or have all the costs of sorting out the stadium lease.

We are still being paid 6.5%, so be patient.

[bobswest] 06/7/2022 18:55

Perhaps someone with some skin in this particular game could drop a line to the RFU Board asking them if they are aware of the situation and whether the RFU has any rules about their clubs financial behaviour?

[addition] 06/7/2022 16:47

I think that some investors will be thinking the same as you. It's a fair assumption but you might be surprised. Hope for the best and prepare for the worst.

You are possibly right about the way to resolve this too. That's what I mean by getting organised.

Finally, this should be listed and traded. It shouldn't be unquoted and I would expect this may get resolved. Just my view.

[addition] 06/7/2022 16:42

Not necessarily. You may be refinanced shortly in or time. What you need right now is a market for the bonds to be re-established. Also, the stadium won't be going anywhere soon.

Stay positive.