Wasps 22 Discussion Threads

[aringadingding] 05/3/2021 18:30

Well not sure i agree with the second part... they know they have that interest payment coming up so either plan for it or put an overall proposal to bondholders in advance. The risk of not lining up funders to refinance the bonds in May '22 would still remain...

But i agree with the first part!! It must be transformational for the club financials and it's what i have been hoping for for ages. New funders will care about the club financials not the bond price. To adapt the words of George W. Bush, one of these days a trader is going to have to explain to me why security prices move.

[fastcat99] 05/3/2021 16:22

Talking of the "bond price moving sideways" - I am AMAZED this news hasn't had any effect other than slight widening of the bid-offer spread!
EXCEPT, of course, that this news is about NEXT season, and to my mind, the real challenge for Bond holders remains our prospects between now and May 11 (the next coupon - if they pay THAT, they will pay everything and the 40+% YTR really will be Xmas coming early....)

[135791113] 05/3/2021 11:47

Good, I wonder what the "deal" exactly was? Have Sisu given up their legal fight, seems unlikely, but good news for Wasps bondholders and Wasps as a club. More pie and pint money.

[dandigirl] 05/3/2021 10:30

Great news O_d! More later today?

[ozzie_dog] 05/3/2021 09:21

10 year deal agreed for Coventry City to play at the Ricoh stadium:



In this article from 2019 CCFC stated that playing at the Ricoh was worth £2m per annum to Wasps. I don't know how valid that is, hopefully it isn't an exaggeration.

hxxps://www.coventrytelegraph.net/news/coventry-news/ricoh-arena-row-sky-blues-16025053

[aringadingding] 04/3/2021 11:26

Er - that sounds good!

[ozzie_dog] 04/3/2021 11:15

There is talk of a forthcoming announcement about Coventry City playing at the Ricoh again:

hxxp://onceawasp.com/forums/index.php?topic=3386.15

[aringadingding] 03/3/2021 09:41

Thank you for that, Ozzie_dog. Interesting source of info.

Likewise I was not a fan until having bought these bonds. They have been enjoyable to watch in the last few years!

Seems like pundits on TV don't want to say the obvious thing, because it's too obvious, which is that Wasps have been severely hampered by England call-ups and injuries, but it certainly seems that way to me.

Price of the bonds still moving sideways... I wonder when some kind of info release will happen.

[ozzie_dog] 18/2/2021 08:26

I find this wasps rugby fan forum a good source of information: hxxp://onceawasp.com/forums/index.php?board I don't just follow it for bond information, since investing in the bond I have started to follow Wasps a little too.

For example, here is a thread about a forthcoming cut in central funding for the premiership clubs: hxxps://www.rugbypass.com/news/englands-top-clubs-facing-50-per-cent-cut-in-rfu-central-funding/

[aringadingding] 10/2/2021 17:30

No worries! Glad you found it interesting.

I find it an interesting point of learning that I only just managed to find that link recently when clearly it's a pretty relevant area of research. Guess it's important to put time into trying to find relevant stuff online even if they don't come up straight away.

[dandigirl] 07/2/2021 11:36

Thanks for the link. Interesting read - guess that the footballers think that the rugby boys are weak and vulnerable at present. Good for Richardson and Co though Coventry FC should have seen the bond interest payment.

Thanks again. Much appreciated. Please do post more as you spot them.

[aringadingding] 04/2/2021 17:00

This story also sums up very relevant background from Coventry City football club's perspective:

hxxps://www.coventrytelegraph.net/news/coventry-news/coventry-city-sisu-ricoh-arena-16173365

Quite shocking really.

With Sisu's very odd track record I can't believe they will be able to finance the construction of a new stadium.

So I think Wasps just have to hang in there, do the refinancing and hope that Sisu either agree to a ground share on reasonable terms in the future, or it would be nice if the refinancing event can somehow be used as a catalyst to make that agreement come about. I say that as a bondholder, out of sympathy for the Wasps owners who are missing out on revenue, but also out of sympathy for the Coventry City fans who want to be in the Ricoh Arena.

In the end it's quite obviously better, financially, for Coventry City, for this football club to be playing in the Ricoh. Separately, for Wasps to ask for some kind of legal assurance from Sisu that they will not continue to pursue historical issues also seems highly reasonable given firstly the number of times Sisu's claims have been rejected by courts and secondly how litigious they clearly are.

[aringadingding] 30/1/2021 16:15

I support the no relegation thing, or can certainly see both sides of it. If clubs have different circumstances or apply rules differently or randomly then major financial consequences does not seem fair as a result of that. Easier just to have a league but without major consequences at the bottom.

I can also see why it hasn't moved the price of the bonds though. If there are 3 main risks (running out of cash; refinancing; relegation) then the last was always the smallest.

I don't think they will run out of cash.

Re. The refi... I still think these bonds are stuck at the current price though i guess a discount to an expected refi price is fair enough.

I think the refi should be fine at 75 to 85p.

A couple of ways to raise 30m for repayment (out of 35m total so 86p):

1) New debt of 25m plus DR equity or directors loan of 5m

2) New debt of 20m plus DR 5m plus other equity or subordinated loan of 5m

If the bondholers were offered a derisory refi price (which perhaps is unlikely givem the fact there is probably some significant overlap with the fan base) then their first consideration i think should be the appointment of corporate finance advisers to sound out coventry city's ground share (with a new company) appetite and the consequent appetite of funders contingent on said ground share.

Following this the wasps offered refi price may potentially improve or look more favourable than the alternative. Some discount to the alternative is reasonable given effort and cost involved. The adviser could potentially be appointed by a collection of larger bondholders happy to pay a 'no success but the refi price has improved' fee (maybe 50 or 100k?) to make it worth the adviser's time.

I guess the club is in the position of deciding what number is high enough to be accepted, and not derisory, but as low as possible!

[ozzie_dog] 19/1/2021 00:14

I meant to add, have you seen the points awarded by the those panels of experts? It certainly caught my eye. Do you not think that they tended to err more than a bit on the generous side with the bonus points, some 'losing' teams were awarded 2 bonus points. Whilst I can understand why it was done, it does fly in the face of statistics, don't you think? Imagine if your club lost out by one point to a team benefitting from those points decisions.

[ozzie_dog] 19/1/2021 00:01

@135791113 Firstly I will say that I do have a significant amount invested in the Wasps bond, and (selfishly) that does massively influence my opinion.

But looking at it from a 100% sport angle only (I do love sport), although I can see and fully understand what you are saying, that under normal circumstances for a league system to make sense, relegation and promotion is desirable.

But there is a huge BUT coming, and that is that some Covid postponed games have been decided by a panel of 'experts', rather than by a playing an actual match! Do you really think that it is fair that a team could be relegated using that system, especially when it might be by one single point? As I understand it, some clubs have already taken legal advice on this, and they have apparently been advised that they would have a valid case to appeal relegation.

[fastcat99] 18/1/2021 22:16

The future of the bond will be determined in the next 3 months - that's The Point I am making; indeed, without our solicitation consent, the Club (or to be precise its key holding company) would indeed already be "going under" right NOW.
You do not seem to countenance the notion that the bonds might soon default to becoming no more than the legally tenuous title to an effectively unrealisable asset.
(Incidentally, I agree with you about ringfencing)

[135791113] 18/1/2021 20:52

I fail to see what point you're making.

The future of the premiership is intrinsically linked to the future of the club. Ergo, it is hardly surprising that the discussions cross over from time to time. If you're not interest in this then don't read and take the time to respond. I also wasn't aware you were responsible for ensuring the thread stays within the very narrow window YOU want it to stay within.

4 months, or 1/3rd of a year, is quite a long time at the moment, when rules, fixtures, plans change every day. In 4 months time the club could have gone under, or have 10,000 people in the Ricoh watching the match and buying pie and pints.

Your modesty is not required; you are not proven right yet and neither is anyone else, so simply reiterating old posts doesn't bring anything new to the discussion.

So anyway, ring fencing the Prem is still a terrible idea.

[fastcat99] 18/1/2021 20:28

Thanks for the passing reference to bondholders, haha - this chat was in danger of becoming a general whither Rugby ? beef-session, and that's really NOT the point. There are now less than 4 months til the next coupon is due, explicit promises made during the 'consultation process' about producing (overdue) full accounts and (more vaguely) the future strategy have NOT been kept - so pricing this risk correctly is becoming more and more dicey.
The yield to maturity is now 35.3% - that's "too good to be true".
With all due modesty, I think my comments after the EGM (#144 & #147) and aringadingding's reply (#156) are still the best way of looking at the key issues.

[135791113] 18/1/2021 19:23

Why is it common sense the Premiership should be ring fenced? IMO that is a terrible idea and goes against everything which sport, and rugby, stands for.

Exeter and Bristol are both examples of teams who have come from the Championship and done very well in the prem. If you take away the chance of moving up then what are the likes of Ealing or the Pirates playing for in the championship, week in, week out. What are the likes of Tigers supposed to be scared of if they know they can never go down.

While the idea might be great from a bond-holders point of view, as a sports fan first and foremost I am dead against the plan and think the RFU need to present a really good argument as to why what we have now isn't working, especially when you can look at Bristol who came up 3 years ago and are now top 5 in the league.

[ozzie_dog] 18/1/2021 18:49

For a long time I have thought that this was inevitable, and I been following the possibility of it, although of course common sense does not always prevail, but at last, here we are on the edge of it happening. I hope (still time for things to go wrong) that it happens.

[dandigirl] 18/1/2021 13:19

Thank you 0_d. An interesting read. Appreciated. + well done The Guardian - haven't seen this elsewhere.

[a0002577] 18/1/2021 12:11

Totally agreed, Ozzie_Dog - Good thinking all round - Wasps doing quite well at the moment - and Exeter seem to have lost their mojo :)

[ozzie_dog] 18/1/2021 09:33

Despite the reduction in central funding, I still think that it would help.