The directors for the Melbourne Rebels have secured a major victory against Rugby Australia after creditors voted to support a rescue deal to save the debt-laden Super Rugby club.
The proposal was put forward by a private equity-backed consortium led by business heavyweight Leigh Clifford and the Melbourne Rebels’ directors.
The Melbourne Rebels will continue its bid for survival after creditors backed the rescue deal. Credit: Rugby Australia
Two sources who attended the meeting, who declined to be named for professional reasons, said the administrator had the deciding vote after the creditor vote was tied on the consortium deal.
The source added that the Australian Taxation Office voted against the proposal.
Loading
Under the deal, employees will receive a return of 100 cents in the dollar, and unsecured creditors will receive between 15¢ and 30¢ in the dollar. The range of the payout will depend on if the directors are successful in their planned legal claim against Rugby Australia over alleged underfunding of the club.
The Rebels consortium must jump two hurdles before it can retain control of the company: Rugby Australia handing back the licence for the Super Rugby competition, and the Australian Taxation Office releasing the directors from their personal liability over the club’s $11.5 million in tax debts.
The group will now have 30 days to negotiate with the peak body for the sport and the tax office. If unsuccessful, the consortium will then have 60 days – or a date approved by the administrators – to commence legal proceedings to wrangle back the licence.
If they’re still unable to claim back the licence, or be released from their director penalty notice, the deal will collapse, and the consortium will no longer have any claim to the company.
Source Agencies
