Club debt over £100m – Vaughan
WASPS chief executive Stephen Vaughan has detailed the staggering nine-figure amount of debt Wasps were burdened with before the club entered administration.
Vaughan was officially made redundant as one of the 167 players, coaches and staff left without a job following Monday’s Wasps Holdings Limited administration announcement. However, he’s still involved as the club races to find some way of keeping Wasps’ name alive in rugby.
If Wasps can salvage a rugby team for next season they’ll be playing Championship rugby, but speaking on The Rugby Pod, Vaughan gave the scale of debt that led to this point.
He said: “The model makes sense - you have a fantastic venue with conferences, events, exhibitions and concerts and the excess from the venue pays for the sporting business, that’s fine in the normal world.
“When the organisation decided to take the bond out seven years ago it automatically put a £35million debt onto the business.
“Then you add on all of the other debts over the years whether it’s pre-covid or not, if you count Derek’s loans (Richardson, Wasps owner) in there as well it’s over £100 million.”
Wasps’ sporting operations and the Coventry Building Society Arena are owned by different companies, meaning a buyer could pick up the arena without needing to take on the rugby element.
But Vaughan added: “Wasps had to go into administration because by nature administration takes away a lump of debt, so therefore it becomes more attractive. So since it’s allowed us to have different conversations with different organisations so that’s why they were split.”
It’s been reported a move away from Coventry could be on the cards for Wasps, especially if they lose the CBS Arena.
However, while admitting ‘everything is still on the table’, Vaughan said he thought the most likely survival plan for the rugby club was to remain in Coventry.
He also rebutted rumours of a merger either with London Irish or Worcester Warriors. Warriors preceded Wasps in entering administration after just one game of the 2022/23 Gallagher Premiership season, while Irish were put up for sale in September.