Former ARL boss raises fears over Warriors purchase
Exclusive: Trust involvement questioned, reports David Long.
Questions have been raised whether Auckland Rugby League, through the Carlaw Heritage Trust, should have been allowed to purchase the Warriors and if the future of the game is at risk.
The trust last week became 67 per cent owners of the Warriors, with Autex Industries owning the other 33 per cent. The total price for the club was a reported $18 million.
Dene Biddlecombe, who was chair of ARL before Cameron McGregor, says the organisation shouldn’t be involved in buying a professional rugby league club.
‘‘It is the wrong thing to do and there can’t be a commercial case for this in any way, shape or form,’’ Biddlecombe said.
‘‘When I was at Auckland Rugby League, there was an opportunity for us to look at Sir Owen Glenn’s interest and there was no commercial reason at all for any entity to pay the money they were talking about for the Warriors. What I’ve seen is that while club league is struggling, clubs can’t pay their electricity bills and there is an enormous drop off in players at all levels.
‘‘Auckland Rugby League has lost sight of what it was formed for, by investing in professional sport.
‘‘The last time they were involved in the Warriors it was a financial disaster. I’m horrified for league.’’
The Carlaw Heritage Trust was set up in 2008 with a loan of $25m created from the ARL to the trust, according to Biddlecombe.
This is being paid back to the ARL annually, with last year that figure being $1.44m.
‘‘The money that has been paid back to the Auckland Rugby League for it to exist has been taking off that loan,’’ Biddlecombe said.
‘‘So within a few years, Auckland Rugby League won’t be owed any money from the Carlaw Heritage Trust and the trust will own all of the league’s assets.’’
The latest financial statement for the trust states it has $2.2m of cash assets, $37.4m of property investments and total assets of $47m. However, it still owes the ARL $11.9m and a loan to Westpac of $27.8m. The net assets are $7.5m and as it paid around $12m for its share of the Warriors, most likely the trust has had to secure further loans.
There is also the question of whether the trust has the remit to buy the Warriors.
The trust is mandated to foster, promote and manage the development of amateur rugby league in the Auckland region at all levels for youth, students, university students and the community of Auckland.
McGregor declined to be interviewed for this story, with the trust sending the following statement: ‘‘The trustees went to great lengths to get extensive legal opinion on the powers of the trustees.
‘‘They are comfortable with their authority to purchase the Vodafone Warriors under the trust deed. Any further inquiries can be referred to the trust’s legal adviser David Jones, Heimsath Alexander.’’
Jones did not return the Sunday Star-Times’ call. If McGregor or Jones would have spoken there are a number of questions they would have been asked.
These are: How much is the trust borrowing for the Warriors? What happens if more money is needed? Are the net assets at risk? How does buying a professional club fit in when the stated objectives of trust are to promote and develop amateur rugby league?’
In the trust’s financial statements for the year ended October, 2017, under ‘pre-payments and other assets’ there is a $1m payment listed for a ‘‘Warriors deposit’’.
What was that for?
The last time they were involved in the Warriors it was a financial disaster. I’m horrified for league.
Dene Biddlecombe