The full extent of Worcester Warriors’ debts has finally been revealed as totalling more than £30m, in a report sent to the club’s creditors by their administrators, Begbies Traynor.
The report also discloses that former owners Jason Whittingham and Colin Goldring claim they are still owed more than £2m by the club’s companies.
Begbies Traynor still negotiates the sale to a consortium of Warriors.
These are the main contenders for the job. fronted by ex-Warriors CEO Jim O’Toole.
After submitting a “significantly higher” bid than rivals, the report shows O’Toole and James Sandford’s consortium paid a deposit of £500,000 to be able to negotiate exclusively.
This exclusivity period runs until November 31st.
In a further demonstration of the O’Toole and Sandford consortium’s long-term intent and commitment, the report also shows they have already invested more than £1m, having also paid off a £634,000 loan taken out by the club’s former owners on land at Sixways.
WRFC Trading Ltd is the Whittingham and Goldring part which owned Sixways. went into administration on 26 September.
WRFC Players Ltd was established in order to pay the Warriors’ staff and players. wound up in the High Court in London On 5 October, contracts were cancelled and 21 players were lost to other clubs.
Warriors were suspended and relegated by the Rugby Football Union – both sanctions are still under appeal on a “no fault insolvency” basis by the administrators, Julie Palmer is the leader
Whittingham was also a recipient of the Goldring Award. disqualified as company directors for 12 months After a Cardiff court hearing in October, the defendant was found guilty of failing to file financial statements for the financial year ending 28 February 2021.
What are the findings of this report?
Begbies Traynor, who was made Warriors’ administrators in September, has done extensive investigations into the club’s financial crisis, including the transfers of land that were made by the club prior the administration. He also investigated the possibility of wrong trading by Warriors directors.
The report lists two of Goldring and Whittingham’s other companies as being owed £2.085m by the club’s trading arm, WRFC Trading Ltd.
Administrators say that this number could still be disputed, but it is only a fraction of club’s debts. This figure was previously speculated on verbally by Begbies Traynor during interviews over the past two-months.
As well as owing the government £16.1m from their Covid Sports Survival loan, Begbies Traynor says the club owe £2.1m in unpaid taxes to HM Revenue and Customs.
Hundreds of suppliers, businesses, banks and ticket holders are also together owed more than £5.8m.
The club’s payroll arm, WRFC Players Ltd, also owed £6.8m at the time of being wound up.
Palmer, the joint administrator, has concluded now that, even if Warriors sold all of their assets, the funds raised wouldn’t be able to pay off the club’s debts.
The club’s assets suffered greatly in 2018 before Whittingham and Goldring became directors. In that year, the freehold of Sixways stadium and a significant portion of surrounding land was sold to WRFC Trading Ltd by another Warriors owner’s firm. It was then leased back from the club.
The club was last sold to a four-man consortium Fronted by Jed McCrory, October 2018.
Whittingham and Goldring were co-owners of Morecambe Football Club. joined the Warriors board in December 2018.
McCrory was then left in June 2019, Whittingham, Goldring are now gone.
If the new club buyers don’t pay them back, then hundreds of suppliers, fans, and businesses will lose all their money.
Palmer states that it is “highly probable” that the money owed HMRC will be repaid, while the Covid Sports Survival Loan looks likely to be taken over by a future buyer.
