Wasps 22 Discussion Threads

[pusb] 20/8/2022 17:52

Had and continue to be had. Smacks of delaying tactics to me. If they had admitted an insolvency event before fixtures were announced, Wasps would have been relegated according to RFU regulations. Fixtures now released so 35 point penalty would result, as there is no performance / league position based relegation at present that penalty is almost meaningless. Trying to limit the impact on sports club while not addressing the impact on investors. Basically Wasps hoping to demonstrate that the insolvency event was avoidable before publication of the fixtures.

Relevant regulations as follows:-

Fixed Sanctions
5.5.5 Subject to Regulation 5.5.8, where a Club suffers an Insolvency Event during the Season or after the end of the Season but before the playing schedules have been set for the following Season, that Club’s most senior first XV team, as determined by the RFU, shall in respect of the following Season be relegated to the League below that in which it participated at the time the Insolvency Event occurred and there shall be no right of appeal for any such Club.

5.5.6 Subject to Regulation 5.5.8, where a Club suffers an Insolvency Event after the end of the Season and after the playing schedules have been set for the following Season, that Club’s most senior first XV team, as determined by the RFU, shall in respect of the following Season incur a 35 point deduction and there shall be no right of appeal for any such Club. Where the RFU is satisfied that the Insolvency Event was unavoidable before the end of the Season and had been delayed by the Club in order to avoid relegation, it shall be entitled in its absolute discretion to impose a further points deduction against that Club’s most senior first XV team and/or relegate that team the following Season to the League below that in which it participated at the time the Insolvency Event occurred, and there shall be no right of appeal for any such Club.

[cesareborgia] 20/8/2022 16:10

The discussion has been fascinating and wonderfully wide ranging. However what I really want to know is when will we bond holders finally admit they have been had?

[bigfish1] 19/8/2022 13:30

A bit more detail: hxxps://www.rugbypass.com/news/cvc-rugby-a-toxic-mix/

[fastcat99] 19/8/2022 13:28

@barondene - I get it now, and you raise some interesting points, albeit about events in 2018-19 (and therefore well before the last Consent Solicitation, for instance)

The Coventry Telegraph is certainly not clear about the exact mechanism of CVC's "stakeholding" in PRL; and if as you suggest there was a DILUTION in existing Pshares which produced 'exceptional income' for Wasps Holdings,
- does that legally constitute a partial SALE ?
- should that revenue have been ringfenced to meet Wasps FINANCE obligations (coupon payments), and was it ?
- murky waters, both legal and actuarial !

Maybe this issue should be raised with the Trustees, but I'm not sure they will take a position on accounts long past and approved.
For it to be fully taken into account, I fear Bondholders might have to take/threaten legal action

[barondene] 19/8/2022 12:46

Fastcat99 - Maybe I am misunderstanding the position. However in the 2019 Accounts there is £12.5 income from a transaction with CVC. As I understand it CVC took a minority stake in PRL - for that to happen there has to be a disposal of some of each shareholders holding. It is certainly classed as exceptional in the accounts so not normal trading. The assumption has to be it is the result of the shares deal .

Hence my question of the position of part disposals.

I do not understand the workings of the P shares and accept I might be totally wrong

hxxps://www.coventrytelegraph.net/sport/rugby/wasps-accounts-june-2019-17208784

[fastcat99] 19/8/2022 11:01

@barondene You seem to misunderstand #868.

He is (correctly) saying that IF the PRL shares WERE to be sold, the money would be ours, NOT that they have been, or are proposed to be, sold.
Nor can we/Trustee force sale of these P shares alongside the sale of the Stadium (lease). But if subsequently, they were sold (eg on dissolution of the club/Wasps Finance/bankruptcy of DR)- the proceeds would be ours.
Surely sales proceeds from PART disposals of P shares would IMMEDIATELY accrue to Bondholders.

[barondene] 19/8/2022 09:33

When the PRL shares sale happened why did the proceeds not go to WF?

The Deed says the shares are not charged but sales proceeds are.

Does thus exclude part disposals?

[cc2014] 19/8/2022 09:03

It would have been floating over everything subordinated to the bond. Probaly subordinated to other loans as well.

[pusb] 19/8/2022 08:53

Was there anything left to use as security that wasn’t included in the bond?

[cc2014] 19/8/2022 08:36

This is beginning to look ugly to me.

Either there is a charge for the Covid loan and Wasps directors have not declared it or their isn't one.

And it seems unlikely that Wasps reached an agreement with the Covid loan scheme that the other rugby clubs did not and further were Covid loans of this magnitude handed over without security?

[addition] 18/8/2022 13:23

Stevros asked about the shares ... it's a bit nuanced. The shares are not part of the security but the proceeds from any sale of the shares are.

Once sold, the proceeds would be for bondholders. Wasps Holdings owns the P-shares and DR owns Wasps Holdings.

[barondene] 18/8/2022 09:27

A salutary tale?

hxxps://www.thebusinessdesk.com/westmidlands/news/2066740-premiership-club-hit-with-winding-up-petition-by-hmrc?utm_source=newsletter&utm_medium=email&utm_campaign=WestMidlands_18th_Aug_2022_Daily

[barondene] 17/8/2022 19:16

You will read that the pitch dispute between WASPs and CCFC has to some extent been resolved, in so far as a temporary repair will take place

The cost of repairing will , initially be paid by CCFC and WASPs will have to repay the £180,000 or so by agreement

[jimpy6365] 17/8/2022 17:40

MESSAGE FROM HARGREAVES LANSDOWN TODAY
RE JUNE NOTIFICATION

Wasps Finance plc - Bond Redemption Update
Reference: 02023748

Dear Mr Parsons

Wasps Finance plc - Bond Redemption Update

Your holding of 10,000 shares within your Stocks & Shares ISA

What is happening?

Wasps Finance plc have provided an update regarding Wasps Finance plc - 6.5% 2022 bonds. It has been announced that there will be a further delay to the expected payment date. The expected date of the delayed redemption payment has not been announced yet; we will be in contact with an update once this has been announced by Wasps Finance plc. Accrued interest up until the redemption date will be paid to bondholders.

“Further to the announcement on 30th June 2022, the Issuer has not yet been able to agree final terms for refinancing and as such will not complete the refinancing and redemption of the Bonds within the previously proposed timeframe. The Issuer is now working on the proposed Bond terms to be amended and will formally launch a consent solicitation process in August, once the proposed terms have been finalised.” (Source, July 2022).

We will contact you again upon announcement of the payment date of the redemption proceeds. Should you have any queries please do not hesitate to contact us.

Yours sincerely

Becky Haworth
Corporate Actions

[cc2014] 17/8/2022 12:43

# Because Wasps don't want a secondary market and/or it means they carry on paying 6.5% even though 20%+ would now be the going rate.

[pusb] 17/8/2022 12:40

Bigfish1 - Potential scenario if bonds not delisted. Investors who purchased at below nominal value decide to take a small haircut. Price tumbles, an interested third party wouldn’t need to invest much (say £4m at 50% of nominal value) to acquire 25% of bonds value, then pretty much having control of what comes next.

[bigfish1] 17/8/2022 12:26

By the way I spoke to the London Stock Exchange and they confirmed that there records show that the bond was delisted at the request of the issuer and for no other reason. Still don't know why though.

[fastcat99] 17/8/2022 11:48

to be clear, my last was @bigfish1, still about Jan 2018 breach of covenants
- glad some others are beginning to appreciate the procedural point(s) which I was already raising 2 months ago

[fastcat99] 17/8/2022 11:44

Check the annual accounts to be 100% sure, but I still think it was actually all done on paper

I was already bondholder then, and pretty sure I didn't receive any notification other than the (tiny) payment,
- that said, I did not yet realise how much this stock needs close monitoring !

[stevros] 17/8/2022 11:27

Bit of background on this. I'm both a rugby fan (not Wasps) and interested in investing, but not a bond holder. So am not directly affected by this myself (as not a football fan either) just interested.

Question, I've not seen one of the other significant assets that Wasps have discussed on here. That is their shares in Premiership Rugby. There are 13 clubs with Premiership Rugby shares, giving both voting rights and increasing prize money (increases it 30% or so)

Last time shares changed hands were when Exeter bought shares off Leeds for £5 million I think. However given on the back of that clubs saw how despite the sale allowing Leeds to clear debts, the reduction in prize money meant they never competed back for promotion, and in fact tumbled further down the leagues, I would suspect that clubs now value the shares higher. Also then, there was only one club (Exeter) really in a place to bid on the shares. Now there would likely be two or three bidders (Ealing, Doncaster and maybe Pirates). So with inflation I would expect those shares to have a value in the region of 10-15million.

Is it known which of Wasps companies hold the shares and would they be an assest that could be sold to rpay the bonds?

[cc2014] 17/8/2022 11:18

#850.



Wasps Community Foundation now shut down due to not filing accounts.



This really is quite concerning. The community foundation has been disolved by complusory strike off by Companies House for not filing it's accounts.

Nic Eastwood is shown as a trustee and he's also a director of Wasps Holdings etc. and Arena Coventry x 2 plus others.

I didn't think charities just get dissolved because trustees can't be bothered to file accounts even if the charity has been by mutual agreement closed. I thought the usual process was to file a final set of accounts and then the directors dissolve it. I might be wrong. However, I see he's done it before with London Wasps Academy Ltd alhtough whether that one was a charity or not I don't know.

[bigfish1] 17/8/2022 10:42

Fastcat, from an article dated May 2018
'As we reported, Wasps had informed bondholders in December last year that it had broken the ‘covenant̵7; pledge to them, and sought bondholders’ permission to modify the covenant. It says this was agreed at a bondholder meeting in January.'

hxxps://coventryobserver.co.uk/news/investigation-wasps-fail-to-come-clean-with-public-over-falsified-evidence-and-overriding-management-controls-to-falsify-accounts/