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Thread: Strapped Rebels in danger of folding

  1. #1
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    Strapped Rebels in danger of folding

    Looks like the Rabble are in dire straits.

    This is in The Australian but behind the paywall.

    Strapped Rebels in danger of folding
    The Melbourne Rebels Super Rugby team are set to fall into voluntary administration, with the ACT Brumbies also on fragile financial ground.

    This was in the Sydney Morning Herald.

    Rugby Australia has refused to guarantee it will provide financial assistance to the debt-ridden Melbourne Rebels as questions remain about their survival beyond the 2024 Super Rugby season.
    The sporting body would only commit to supporting the embattled club for this year, claiming on Wednesday that any long-term decisions were dependent on whether the team was contributing to a “sustainable future for the game”.
    The Rebels met Rugby Australia officials on Wednesday after the sporting body instructed the club to call in independent financial advisors to present what options they had moving forward.
    The team is again the focus of scrutiny this week amid reports of the deepening financial strife its key sponsor BRC Capital – whose chairman Paul Docherty also chairs the Rebels – is facing. Ten of the investment company’s businesses have collapsed in the past two months.
    In December, it was revealed that the Rebels owed millions of dollars to the Australian Taxation Office and about $1 million in fees for use of AAMI Park stadium, managed by the Melbourne & Olympic Parks Trust.
    The Rebels met Rugby Australia officials on Wednesday after the sporting body instructed the club to call in independent financial advisors to present what options they had moving forward.
    Asked whether Rugby Australia would help the club pay its millions of dollars in debt, a spokesperson said: “RA and the Rebels are currently awaiting a report from the Rebels’ financial advisors. Following the receipt of this report RA will evaluate the best, and most appropriate course of action.
    “RA is committed to exploring ways to build long-term viability for the professional game in Victoria. Any future decisions need to ensure the Rebels are contributing to a sustainable future for the game, and we want to see Melbourne as part of that future.”
    The Rebels were contacted for comment but did not respond in time for publication.
    Rebels chair Docherty was the subject of news stories this week, prompted by an article from the Australian Financial Review, which revealed on Tuesday that one of those companies, dental supplier SmileStyler, was the subject of an administrator’s report that revealed a litany of problems.
    When concerns over the Rebels’ future were raised in December, club boss Baden Stephenson told this masthead the financial problems were solvable, and that the issues were not unique to the club, but a broader problem across Super Rugby’s five Australian teams.
    He pointed to a cut in funding from Rugby Australia due to COVID-19 and the return of Western Force (that's it blame the Force!), which reduced the money given to each club from $5.5 million a year to $3.9 million.
    He also confirmed that talks had broken down for Rugby Australia to take control of the Rebels.
    “We very much were open to having a conversation around the centralisation of the commercial assets of our club. We had one brief conversation … those conversations have ceased for the moment, I don’t think it’s a major priority for Rugby Australia,” he said.
    With Iain Payten

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    Veteran Sheikh's Avatar
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    I've got $1, if that's any help

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    Immortal Contributor shasta's Avatar
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    Quote Originally Posted by Sheikh View Post
    I've got $1, if that's any help
    You need to have $9,000,001. Debts of $9m have to be settled before you can buy.
    I'm not sure how a $1.6m funding cut equates to $9m but that's what the Rabble are claiming.

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    Immortal Contributor The InnFORCEr's Avatar
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    Rugby Australia backs Rebels chairman despite $50m in company debts
    Zoe Samios
    Jan 24, 2024 – 6.25pm



    Rugby Australia is seeking answers from the Melbourne Rebels rugby union club about its financial position as debts owed by businesses associated with a key backer, BRC Capital, climb to more than $50 million.

    But the governing body is backing BRC Capital founder and Melbourne Rebels chairman Paul Docherty, despite administrators discovering millions of dollars owed to investors, staff and the Australian Tax Office across his business subsidiaries. Rebels chief executive Baden Stephenson has defended his chairman, describing him as “widely respected in rugby circles”.

    Rugby Australia has asked the Rebels club to seek external advice about its financial position. Getty

    The Australian Financial Review revealed last month that the Melbourne Rebels has outstanding tax bills and stadium fees that were unpaid as of last December. An RA spokesperson would not say whether the tax bill was paid.

    “RA’s focus is on the future sustainability of the Melbourne Rebels, and we continue to work diligently with Paul and the board of the Rebels on that,” a spokesperson for the governing body said.

    “RA’s commitment is to address the financial matters concerning the Rebels directly with the Rebels, and to build long-term viability of the professional game in Victoria. As such, we have recommended the club seeks external financial advice.”

    Mr Stephenson told AFR Weekend Mr Docherty was a respected member of the rugby community, who was responsible for leading the country’s Pasifika strategy, international partnerships and securing a State Centre for Excellence.

    “He’s fully invested in the code in Melbourne,” he said. “Our board, our management, staff and players universally love him. He’s a big character and he puts a huge amount of time and effort into the Melbourne Rebels.”

    “In his tenure as chairman, he has worked closely with government, commercial partners, members and community, and he feels equally comfortable talking to and supporting all of these important stakeholders,” he said.

    Unpaid super
    The comments come as another subsidiary of BRC Capital, Hood AI, fights staff over thousands of dollars it owes in superannuation and wages.

    Hood AI specialises in electricity and gas connection services for real estate agencies and was issued with a wind-up order from Noel Jones Real Estate on November 9.

    It is run by BRC Capital and names Mr Docherty as a director alongside its former CEO, Tom Fraser. The matter lodged by Noel Jones was resolved, but five days before Christmas the business told staff it could pay only 40 per cent of salaries owed for December.

    In a message on Slack last week, Hood AI’s interim CEO, Stuart Johnson, said every effort was being made to pay staff.

    “The investment side is a constantly fluid situation and whilst there are highs and lows in that I am trying to keep it as emotionally even keeled as we can for the team,” he said on January 18. “What I assure … the staff team of is that every effort is being made to resolve outstanding pay and super and also to create a platform from which Hood can grow in 2024.”

    Hood AI was issued with a wind-up order in November. It has since been resolved.

    Several sources inside Hood AI said the business paid the remaining 60 per cent last Friday, but has now not given staff their owed January wages.

    Hood AI has not paid superannuation since the previous financial year, according to the staff members who spoke on the condition of anonymity.

    Hood AI, which secured a $16 million loan in 2021, was under no obligation to stop trading after receiving a wind-up notice. That ultimately depends on whether a business can repay its debts and is not trading while insolvent. While the matter with Noel Jones is resolved, sources close to Hood AI said other clients were still owed money.

    Mr Johnson was approached for comment.

    Demise of BRC Capital
    The failed payments are the latest in a series of revelations by The Australian Financial Review about BRC Capital and the embattled Melbourne Rebels, both of which are run by Mr Docherty, who describes himself as a “serial entrepreneur”, and his business partner, Mark Dinnison.

    BRC Capital is an investment firm created by Mr Docherty in 2017 that has launched a variety of start-ups including Hood, Hiro, a cosmetic and personal care supplier, and SmileStyler, which offered clear retainers to dental clinics.

    ASIC documents show the start-ups have attracted high-profile investors including the Myer family, REA Group, former Treasury Wine Estate board member Lyndsey Cattermole, former EBOS chief executive Pat Davies and former Photon Group CEO Matthew Bailey.

    Hood AI, which was once described by BRC Capital as the “Uber of moving house”, is one of an increasingly long list of companies connected to Mr Docherty and Mr Dinnison that are in financial strife.

    BRC Capital founder and Melbourne Rebels chairman Paul Docherty. Facebook

    Ten of BRC Capital’s subsidiaries were issued with wind-up orders or put into administration in just two months as revelations of unpaid tax invoices, convertible notes and wages emerged in a series of administrator reports and creditors minutes filed to ASIC.

    Rugby ties
    Mr Docherty’s business, BRC Capital, is a key sponsor of the Rebels, which The Australian Financial Review revealed last year was behind on payments to the Australian Taxation Office and also on stadium fees. Mr Docherty is chairman of the Rebels and a director of Rugby Victoria.

    Late last year, Mr Stephenson said the club could get through the financial squeeze after reports its total debts are about $9 million. He also wrote to players and staff assuring them their jobs were safe this year.

    But in late December, Rugby Australia chief executive Phil Waugh refused to guarantee the team’s long-term survival.

    “It is our intent to have five teams in five markets,” he said. “That’s Super Rugby presence, as we sit here today. But right now, we understand there is a reset of the game and how do we look at what is the best path forward?“

    https://www.afr.com/technology/rugby...0240116-p5expo

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    Immortal jargan83's Avatar
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    That's a shame.

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    Hey Baden, Give Bill Pulver a call.......

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    Immortal Contributor shasta's Avatar
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    Quote Originally Posted by Hansie View Post
    Hey Baden, Give Bill Pulver a call.......
    "G'day Bill, Baden here. Do you still have your great big spreadsheet?"

    "Yair, it's out in the shed somewhere, I think. Why?"

    "We need it again. Any chance you could send a copy to Phil Waugh and explain how to spin it, please mate"

    "OK, piece of cake"

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    Melbourne Rebels headed for voluntary administration

    The Melbourne Rebels is expected to fall into voluntary administration as early as Thursday afternoon, adding to a long list of companies chaired by businessman Paul Docherty that have collapsed in the last two months.

    The Australian Financial Review revealed last month that the rugby union club had outstanding tax bills and stadium fees that were unpaid as of last month, with debts of more than $10 million. On Thursday, Rugby Australia said it had asked the club to seek external advice about its finances.

    “RA’s commitment is to address the financial matters concerning the Rebels directly with the Rebels, and to build long-term viability of the professional game in Victoria. As such, we have recommended the club seeks external financial advice,” a Rugby Australia spokesman said, adding that the club would play the coming season.

    The Australian reported that the club had appointed Wexted Advisors as administrators. It is unclear whether Mr Docherty will remain in his position.

    If the Melbourne Rebels goes into voluntary administration, it would add to a long list of companies backed by Mr Docherty that have either been wound up, liquidated or put into administration in the past two months.

    Mr Docherty has faced questions over the past month over how the rugby club had fallen so far behind on its tax bills, with directors of the Melbourne Rebels receiving penalty notices from the tax office demanding payment.

    BRC Capital is a major sponsor of the club, which finished eighth in the competition last season, tipping in about $100,000 a year in sponsorship contributions.

    Six companies that had received investment from BRC Capital have been placed into administration over the past two months, with administrators discovering they owe more than $50 million in salaries, superannuation, contractors and tax liabilities. Another four companies have either been issued with wind-up orders or liquidated.

    Mr Docherty has previously told the Financial Review that a sharp change in market conditions made it difficult to raise fresh capital to keep the companies afloat.

    The interlinked nature of BRC Capital’s investments, which include former ASX hopeful HIRO Brands, HoodAI, 3DMediTech and SmileStyler, have meant administrators are working out which creditors have claims in which places.
    https://www.afr.com/companies/sport/...0240125-p5f00o

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    They just sound like a bunch of cowboys. At least we know Twiggy's other businesses are legitimate companies that actually make money, these guys just sound like punters

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    Veteran Sheikh's Avatar
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    I wonder what Ryan Louwrens is thinking. IIRC, he was with us when the Force got culled, went to Japan and came back to Melbourne last year, only for the Rebels to be potentially hooked.

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    Getting worse

    The playing future of Wallabies stars Taniela Tupou and Andrew Kellaway are up in the air amid reports the cash-strapped Melbourne Rebels have entered voluntary administration needing a bailout of up to $500,000 to pay players and staff.
    Less than a month out from their season-opening clash against the Brumbies on February 23, the Rebels have appointed external financial advisers, Sydney firm Wexted, to help address the club’s $9m debt.

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    Immortal Contributor shasta's Avatar
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    OK, most of us don't have a lot of time for the Rabble. But I hope they can muddle through somehow for the sake of their supporters, players & coaches. We know first hand how depressing the alternative can be. We are just extremely lucky to have had the support of a committed billionaire.

    RA has stated that they won't support them past 2024. I'm guessing that means this years funding distribution that all teams get. Though RA was evasive about what it might do after a report from the administrators. The point I'm wondering is; at what point is an organisation trading while insolvent or whatever the legal term is? Can the Financial Administrator just say the jig's up and call the receivers?

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    A secured creditor can appoint receivers. It sounds like they have sufficient funding to play the next year, maybe Rugby Australia is backing them. The Voluntary Administration gives them a bit of breathing room to try to trade out of the position.

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