Melbourne Rebels sale opens door to cut club, says former Wallaby John Welborn

Saw this in the Sunday Times now online at The West

Nick Taylor
Sunday, 6 August 2017 11:45AM

The controversial sale of Melbourne Rebels to the Victorian Rugby Union is the springboard for the Australian Rugby Union to jettison the Super Rugby club, says former Wallabies and Force forward John Welborn.
The ARU was blindsided by Friday's move that saw Rebels owner Andrew Cox's Imperium Sports Group quietly sell 11,625,000 shares to the VRU for just $1, throwing the future of Super Rugby into further chaos.
ARU chairman Cameron Clyne, chief executive Bill Pulver and board members only discovered the move when it surfaced in the media.
The Rebels and Western Force are under threat of the ARU axe from Super Rugby next season and yesterday Force billionaire backer Andrew Forrest spoke to Clyne asking for clarification of the situation.

More here

https://thewest.com.au/sport/rugby-u...-ng-b88559512z

You know what? I was just thinking,

The VRU have no assets or cash reserves to support the Rebels, RugbyWA are in the same boat re the Force. the private ownership model is now dead and all team administration is now (albeit with some variations re the Force and the Tahs) in the hands of state unions and the ARU continue to bleat about the unbudgeted funds being used to prop up Super rugby.

PErfect solution, go to SANZAaR and tell them we won't be able to "cut" or "chop" a team immediately, but we do have a plan to ensure that Australia will field an appropriate number of competitive and financially stable teams. Announce to each team the budgeted spend on Super rugby grants, divide that number by 5 and steadfastly refuse to give a single cent to anybody. If the "Heartland states" deserve to be protected in the way they are, they will be able to sustain themselves fiscally. If the teams who are under threat of extinction are there as a result of an informed and dispassionate assessment they will fall. Let the free market decide who goes and who stays, what are you scared of money-pit NSWRU?

This issue is not about not knowing how to save Aussie rugby, it's about not having the huevos to actually do it!

Really interesting point which John Welborn makes, the Rebels do appear to have just given the ARU a reason to get rid of them. I remember when the news about the sale of the Rebels first came out I wondered whether it was an ARU beat up (oh no, we can't remove the Rebels now, since they're owned by VRU). I'm still not sure whether this whole thing is actually an ARU beat up. It'll be interesting to see how the ARU play this one.

Rebels Facebook media team seems pretty happy, even if they couldn't field enough players to fill all their jerseys for the photo:https://www.facebook.com/melbournere...69867719720445

The Australian12:00AM August 7, 2017


WAYNE SMITH
Senior sport writerBrisbane
@WayneKeithSmith

It’s not yet all over for the Australian Rugby Union. However, the moment has arrived for it to consider not just that it may not be able to cull one of its five Super Rugby teams, but also all of the ramifications that will flow from that.

The ARU reacted with outrage at news the Melbourne Rebels — who, with the Western Force, are one of the two teams it had marked for possible extermination — had changed owners late on Friday.

It insisted that, “despite recent attempts to confirm their position”, the Rebels had left the ARU in the dark about plans to switch from owner Andrew Cox and his Imperium Group to the Victorian Rugby Union, in contravention of their Participation Deed.

This was erroneous on two counts, according to the statement released yesterday by the VRU. First, the VRU had kept the ARU board and management informed of the progress of the sale every step of the way, as one would expect from an organisation chaired by Tim North QC.

Second, as The Weekend Australian explained, the sale may not have been the ARU’s to approve. The 2015 sales contract with Cox included a put option that allowed him to return the Rebels debt-free to the VRU for what he paid for them, $1. By signing off on the deal, the ARU effectively was giving pre-approval for the transfer back to the VRU. So the national body hardly needed to approve a sale it had already condoned.

Yet again, the ARU looks to have been outmanoeuvred, which has happened time and again throughout this whole “five into four” process. While the put option had never been revealed to the public, the ARU cannot have been unaware of it nor, indeed, been ignorant of its potential to derail the ARU’s plans to buy back the Rebels’ licence and close them down.

So now, the ARU must decide if it will test in court whether the Participation Deed does in fact trump the put option. Otherwise, Australian rugby has come full circle, right back to the starting point where the ARU originally promised SANZAAR it would cut one of its teams, knowing full well it would be the Force, which it owns.

If the arbitration process held with the Force last week goes the ARU’s way, it will attempt to close down the franchise almost immediately, although the Perth club has already signalled its intention to appeal to the Supreme Court.Even if fast-tracked, this process could take four to six weeks, time SANZAAR doesn’t have if it is to do all the logistical planning needed to get the 2018 season organised.

If the Force prevail, the ARU must decide whether to continue to pursue the costly legal process through the courts, or admit defeat and go back to SANZAAR and admit it had promised what it couldn’t deliver. Increasingly, this is looking like the probable outcome — which means the time has come to start analysing how the ARU placed itself in this humiliating mess.

Right from the outset, those at the ARU’s St Leonards base in Sydney made no attempt to consult with anyone who did not agree with their world view that (a) they needed to support grassroots rugby, however poorly defined that might be; that (b) running five professional Super Rugby teams was unsustainable and (c) that five teams was uncompetitive, despite Queensland and NSW both winning Super Rugby titles when there were five Australian franchises.

Even the one ARU board member who disputed this world view was shunned and ostracised. Sources have told The Australian that Geoff Stooke, the only member of the nine-strong board who back in April voted against cutting one of the teams, was asked to recuse himself from ARU boardroom discussions on this issue, primarily because of a perceived conflict of interest and specifically that he had purchased 10 shares in the Own the Force campaign.

Goodness gracious, who would have suspected Stooke would support a Perth team, just because he lives there and was the original Western Force chairman?

He has played, astonishingly, somewhere in the vicinity of 900 games of club rugby union — which is more than fellow directors John Eales, Paul McLean and Brett Robinson, Wallabies all, could collectively muster — so when the talk turns to grassroots rugby, he is right in his element. By all means, factor in his WA bias, but in a boardroom of corporate high-flyers, surely Stooke’s was the common man’s voice that should have been listened to?

Yet there is evidence a number of directors are becoming increasingly concerned by the massive reputational damage that is being inflicted on rugby through and because of this issue. Whatever crises other sports are going through lately, they at least can console themselves that they are not going as badly nor perceived as poorly as rugby union. And no doubt directors also are concerned about how their individual reputations are holding up.

All the good work CEO Bill Pulver initially achieved in terms of improving the ARU’s relationships with its constituent bodies and its finances has been undone over the past year. Certainly it has no credibility left with the Victorian and West Australian governments, nor with the Victorian and WA state bodies. The ARU might give lip service to the idea of everyone working together, but by that it means everyone doing precisely what head office dictates. As for the state of the ARU’s finances, it’s a disaster on every level, though money can always be found for expensive legal battles.

Through all of this, many of the constituent bodies have done little to bring credit on themselves.

The day is coming, and soon, when difficult issues such as a workable salary cap, Wallaby top-ups, a draft of some description and compensation for producing players will have to be discussed, at least if there is to be some semblance of fairness among Australia’s Super Rugby teams. That’s when those states who have kept their heads down while the Force and the Rebels were in such peril, hoping to benefit from the dispersion of players, from whichever side went under,will need to sit down with the Perth and Melbourne franchises and work out how an equitable system can be built from the ground up.

Something good has to come out of all of this, something must. As they say often in rugby, never waste a good crisis.

http://www.theaustralian.com.au/spor...dd07b664cc5311

Wow good news they are starting to get concerned about the damage to their reputations!!

Sounds like bully boy board room tactics to try and get rid of or discredit a long standing servant of the game. Shame on you ARU.

So none of the other people on the board want to support rugby by purchasing shares in the own the Force campaign. Well that's telling isn't it. What a disgrace they are.

"While the put option had never been revealed to the public, the ARU cannot have been unaware of it "

Why not? They didn't realise or remember they'd signed an agreement with us ensuring our survival for this broadcast agreement.

Quote:

---

...Yet there is evidence a number of directors are becoming increasingly concerned by the massive reputational damage that is being inflicted on rugby through and because of this issue...And no doubt directors also are concerned about how their individual reputations are holding up...

---

Good to see they have their fingers on the pulse of public opinion....not!

FFS are they blind at the wheel? Every single day for 110 days they have been lambasted and denigrated. Even Reds and Tahrds supporters are fed up with this fiasco. And worst, the fifth column oops I mean fourth estate have turned on them. Wallabies played like turkeys in June, the Tahrds and Reds were complete shite all season, Rebels clueless. Perth won the NRC and equal with Brumbies, half the team in the W squad, sorted it's financials before the Day of Infamy. Yup let's "exterminate" them

Oh, and let's send Stooke to Coventry while we're at it.

It's now time to call for that vote of no confidence and dump the entire board. Come on you gutless wonder stakeholders, just do it

I said in another thread that if the price that has to be paid to achieve the things Wayne talked about at the end of the article is that the current ARU had to crash and burn then so be it. The damage, incompetence and deceit have that happening before our eyes right now. I just want this to be over. Buy our shares, secure the Force and see some honest people pick up the pieces and make those changes.

Maybe the other franchises should come up with similar community based part ownership schemes.

I went as far as to look for a book this farce just then. Sportsbet are missing a golden opportunity

http://www.abc.net.au/news/2017-08-0...to-vic/8779434

It appears as though the Rebels' lawyers feel they can build a case that the ARU had already approved the transfer of ownership when they signed off on the Imperium deal. It looks more and more that the executive staff of the ARU have spent their very expensive hours in office playing soggy Sao whilst the rest of the world writes contracts that secure what they need.

This mob need to go as soon as possible, every dollar they receive appears to cost the ARU about 10.

the inability to organise a pissup in a brewery line is too generous for them, they would struggle to organise breathing in .......air or something like that!

meh this has the potential to go on forever but I have no sympathy for the rebels or their 13 supporters now because of the way they constantly portray themselves (and us) in social media.

1. We given given assurances that we will stay (force will go) haha.
2. We in line for the chop now - what? How could that be us and not the force. Well doesn't matter our white knight cox will never sell the licence back to the ARU we're safe. But the force don't own their licence so they're done. Supporters actually backing their team with money to own the licence is silly.
3 Hmm arbitration...well we agree with the ARU on that one. We don't need to worry about the assurances until 2020 because the SANZAAR knight of the long knives which boned 3 teams has changed the agreement now. So walk on Force.
4. oh cox did cut and run..no matter the VRU own us so we are in an even stronger position.
5. look at the market. Melbourne will soon be the largest city in australia, doesn't matter about our juniors or bums on seats or how the team is performing.

Illogical claptrap delivered with a level of smugness reserved for east coast rugby.

Think it was said before during the 48-72 hour period where time has stood still that no matter what happens now the rebels are a dead team walking. The ARU have shoved rivers of gold at a private ownership model and now that particular river has run dry and all the indicia such as membership, sponsorship, crowds and results have gone south in a big way, the first thing the private owner does is drop the dead donkey rather than put his hand in his own pocket.

Given the enormous (and exponentially growing) pile of shite the ARU is creating right now I would be surprised if they could stave of bankruptcy let alone give an organisation which has very little assets ,the VRU, money above and beyond whatever deals they do with the reds, tahs and brumbies.

Quote:

---

Originally Posted by GIGS20

You know what? I was just thinking,

The VRU have no assets or cash reserves to support the Rebels, RugbyWA are in the same boat re the Force. the private ownership model is now dead and all team administration is now (albeit with some variations re the Force and the Tahs) in the hands of state unions and the ARU continue to bleat about the unbudgeted funds being used to prop up Super rugby.

PErfect solution, go to SANZAaR and tell them we won't be able to "cut" or "chop" a team immediately, but we do have a plan to ensure that Australia will field an appropriate number of competitive and financially stable teams. Announce to each team the budgeted spend on Super rugby grants, divide that number by 5 and steadfastly refuse to give a single cent to anybody. If the "Heartland states" deserve to be protected in the way they are, they will be able to sustain themselves fiscally. If the teams who are under threat of extinction are there as a result of an informed and dispassionate assessment they will fall. Let the free market decide who goes and who stays, what are you scared of money-pit NSWRU?

---

The Force may actually be cash flow positive this year, off the back of the biggest front of shirt sponsor in the competition. The irony being, if they turn a profit, the $ will go to the ARU (thanks to all the hard work the RWA crew, not ARU, did), with the ARU citing poor finances as the reason for cutting a super side.

Quote:

---

Originally Posted by Herbasimplex

meh this has the potential to go on forever but I have no sympathy for the rebels or their 13 supporters now because of the way they constantly portray themselves (and us) in social media.

1. We given given assurances that we will stay (force will go) haha.
2. We in line for the chop now - what? How could that be us and not the force. Well doesn't matter our white knight cox will never sell the licence back to the ARU we're safe. But the force don't own their licence so they're done. Supporters actually backing their team with money to own the licence is silly.
3 Hmm arbitration...well we agree with the ARU on that one. We don't need to worry about the assurances until 2020 because the SANZAAR knight of the long knives which boned 3 teams has changed the agreement now. So walk on Force.
4. oh cox did cut and run..no matter the VRU own us so we are in an even stronger position.
5. look at the market. Melbourne will soon be the largest city in australia, doesn't matter about our juniors or bums on seats or how the team is performing.

Illogical claptrap delivered with a level of smugness reserved for east coast rugby.

Think it was said before during the 48-72 hour period where time has stood still that no matter what happens now the rebels are a dead team walking. The ARU have shoved rivers of gold at a private ownership model and now that particular river has run dry and all the indicia such as membership, sponsorship, crowds and results have gone south in a big way, the first thing the private owner does is drop the dead donkey rather than put his hand in his own pocket.

Given the enormous (and exponentially growing) pile of shite the ARU is creating right now I would be surprised if they could stave of bankruptcy let alone give an organisation which has very little assets ,the VRU, money above and beyond whatever deals they do with the reds, tahs and brumbies.

---

Exactly - at the EGM the Rebels showed no compunction in offering up the Force for the cut, so long as they were safe! What shits me most is the song and dance made about $4.8mill (whatever) for the licence, and yet no one seems to have bleated a word about the massive $$$ that's disappeared in this latest deal. Who the hell paid their debt off? Not a bloody peep about it, it just gets magically disappeared.

Are we sure the MRRU had any debt when the VRU took over on Friday? Don't forget the ARU made sure the company was debt-free when Cox acquired it in mid-2015 and has given them extra money since then in the form of additional grant funding. If they are still in debt despite that, then their accountants are rubbish!

Maybe Lou can tell us? The company has not filed any accounts in its own right with ASIC so it's not possible for us to check.

I would suggest that if they carried debt into the Friday transfer, the Rebels need to be put out of their misery quickly.

Quote:

---

Originally Posted by LMSC

The Force may actually be cash flow positive this year, off the back of the biggest front of shirt sponsor in the competition. The irony being, if they turn a profit, the $ will go to the ARU (thanks to all the hard work the RWA crew, not ARU, did), with the ARU citing poor finances as the reason for cutting a super side.

---

Surely, if the Force end up on the right side of the ledger the ARU would be honour-bound to take that off the licence buy back.........oh yeah. What was I thinking there? Uppercut delivered. :S