Cardiff Rugby are set to file a note of intent to enter into administration as the fall out following the death of their long term benefactor, Peter Thomas, begins to hit home.
Thomas ploughed millions into the regional entity from its inception in 2003 up until his death at the age of 79 in March 2023, when new investors were sought to keep the club afloat.
Helford Capital Limited, led by British businessmen Phil Kempe and Neal Griffith, completed their take over after the investment group acquired an 84.55% shareholding in the club in January 2024.
This week it was revealed that Griffith was the former chief executive and shareholder of financial services venture, Optima Worldwide Group, that went into liquidation in 2021 owing creditors £37m. The liquidation process for that company is ongoing.
The financial turmoil at Cardiff will be all too familiar to the players, who were faced with a severe downturn in payments back in 2023 as the financial picture worsened coming out of Covid. The WRU payment to the regions dropped from £7.2m in the 2022-23 season to £5.2m in the next season and then to £4.5m for this campaign.
Players were told that wages would be slashed, with some being offered as little as £30,000 for a year having previously earned £100,000+. Some left the club, while others looked for different professions.
Against this background the WRU has been trying to drive through a new six-year Professional Rugby Agreement with its four professional clubs. CEO Abi Tierney has been promising to reach a final agreement for some time and this latest hiccup is likely to lead to further delay.
READ MORE: No Coach, No Strategy, No Future . . . And No-One At Home At The WRU
Both the Scarlets and Ospreys posted losses for the last financial year at the end of last month. The Scarlets lost £2.59m, down from £2.91m the previous year, while Ospreys recorded a £2.18m loss, slightly up on the previous year's figures of £2.15m.
It is understood Tierney had a meeting with the management board of the Cardiff Athletic Club (CAC), who own the lease to the Arms Park and have the Cardiff RFC club side as a constituent member, on Monday night to confirm the WRU intentions to take over the running of Cardiff Rugby.
While CAC have been reluctant to agree a new long term lease with Cardiff Rugby they are believed to be much happier to work in conjunction with their neighbours at the WRU. Granting them an extended lease could allow the two parties to work in tandem to develop one of the most prize city centre sites in the Welsh capital.
The players and staff at the club were called to a meeting in the Sir Gareth Edwards Lounge this afternoon (2.30pm Tuesday) to hear from CEO Richard Holland.
In a statement, the WRU said: "We are aware Cardiff Rugby have confirmed notice of intention to appoint administrators and we are working closely with the Cardiff Board and the administrators to safeguard the future of professional rugby in Cardiff."
THE FINANCIAL TALE OF WOE AT CARDIFF RUGBY
YE June 2017: loss of £1.45m
YE June 2018: operating loss £1.3m
Peter Thomas wrote off £3.33m in loans, converted £10m+ into equity
Director Martyn Ryan wrote off £933,708
That reduced debt from £15.75m in 2017 to £4.16m
YE June 2019: accounting profit £3,000
YE June 2020: operating loss £466,000, total liabilities £4.6m
YE June 2021: loss of £1.6m
YE June 2022: loss of £2.2m
YE June 2023: loss of £2.1m
