EXCLUSIVE: Government ‘to blame’ for the crisis at cash-strapped Worcester Warriors as they are accused of aiding the asset-stripping of the troubled Premiership Rugby club… which has jeopardised any proposed sale
- The Government stand accused of asset-stripping the Worcester Warriors
- Sportsmail has learned the details of a major change to Worcester’s tenancy
- The owners have been trying to sell the club for most of the summer
- A deal has not happened, and the latest revelations could put it further at risk
The Government stand accused by some creditors of aiding the asset-stripping of Worcester Warriors which has put the future of the rugby club in doubt.
Sportsmail has learned the details of a major change to Worcester’s tenancy at Sixways Stadium that was approved by public body Sport England last month, with owners Colin Goldring and Jason Whittingham transferring ownership of the ground to a new company which will retain all of the club’s matchday, hospitality and sponsorship income.
It appears the extraordinary move has jeopardised the proposed sale of the club, threatened the livelihoods of businesses and put £15million of taxpayers’ money at risk.
Goldring and Whittingham appear to have lawfully carved off Worcester’s money-making elements into a separate company, Sixways Stadium Limited, leaving the rugby club to operate separately.
As a result, they have been left without their main sources of income and no way of paying off debts of almost £30m.
The owners have been trying to sell the club for most of the summer but despite claims of interested parties, a deal has not happened.
The Government stand accused by some creditors of aiding the asset-stripping of Worcester
The club’s owners transferred the Sixways Stadium ownership over to a new company
Well-placed sources indicated yesterday that the process of reaching a legal ‘heads of terms’ agreement with buyers has been hindered by the owners’ desire to retain a 15 per cent stake.
The club’s home opener against Exeter last Sunday was in doubt until the 11th hour, and it is unclear whether they will be able to fulfil Saturday’s visit of Newcastle.
The Warriors can send a team to face Gloucester at Kingsholm tonight in the Premiership Cup, but staff met yesterday to discuss strike action and a lack of final decision leaves the league clash in doubt.
It is unclear whether the Worcester Warriors will be able to fulfil Saturday’s visit of Newcastle
Sport England’s involvement in Worcester’s financial affairs stems from the Government’s £15m loan in February 2021 as part of their Covid-19 Sports Survival programme.
It is understood that around £9m of the loan was used by the owners to pay off debts accrued in buying the club, as well as gaining the freehold to Sixways, which was then acquired by the owners’ property company.
To compound Worcester’s plight, the terms of the lease were dramatically altered last month, with Sixways Stadium Ltd given the rights to ‘run hospitality events on the property at any time,’ and ‘retain the proceeds of sales,’ according to documents seen by Sportsmail.
The owners’ property company also separated the stadium, training centre and players’ car park from other land around the complex, which was mortgaged off to another company called Triangle Petroleum for £600,000, at an interest rate of 20 per cent.
As the biggest creditor, Sport England were required to sign off such changes, and confirmed in a waiver signed last month that they retain the ‘first legal charge on Sixways Stadium Ltd’ for an amount no less than £14.65m.
A number of creditors are understood to have written to the Government outlining their grievances, with one accusing Sport England of asset-stripping.
‘It appears Sport England presided over asset-stripping,’ one wrote.
Can Sport England please explain why they thought this was in the best interests of the club and the taxpayer?’
Sport England are understood to have acknowledged the complainant’s letter, but have not replied in detail. They declined to comment when contacted by Sportsmail but Whittingham responded by stating: ‘If you understood any of the genuine detail around the transactions then it would be far less interesting and sinister.
‘The genuine detail would demonstrate that any and all actions have always been in the best interests of the club and the community. I’ll be giving a true version of events in due course.’