Port Elizabeth - SA Rugby have “facilitated and are working on” a sponsorship deal with a potential equity partner, worth R80 million to save cash-strapped EP Rugby from liquidation.
This emerged on Tuesday at the Port Elizabeth High court when EP Rugby essentially needed to show why the provisional liquidation order against it should not be made permanent.
A provisional liquidation order was made earlier in March. The liquidation application was filed in January and initially saw 18 professional rugby players claim that the EP Kings owed them close on R1.3 million in salary arrears.
Subsequently, a further 18 players joined the application as intervening creditors, claiming that EP Kings were in breach of an arbitration ruling awarding them R18 million in respect of salary arrears and other benefits.
The players, together with the SA Rugby Players' Association (Sarpa), asked the court to liquidate the EP Kings as a result of them being unable to pay their debts. Attorney Craig Jessop, who represents some of the players, said a sum of R20 million had already been placed in the trust account of the attorney's representing EP Rugby.
On Tuesday, Judge Elna Revelas ordered that EP rugby business rescue application be submitted by May 24. Jessop told reporters outside court the papers filed on Tuesday indicated that SARU has facilitated and is working on a sponsorship deal in the amount of approximately R80 million.
“The amount that has been paid in at the moment as we understand is at present only R20 million. The players, whilst they welcome this as a positive development, we have no idea as to what the business plans that EP Rugby have in this regard. In short they sort a postponement to launch a business rescue application and in essence have indicated that the R20 million is in good faith,” When asked if all players welcomed the idea of a business rescue, Jessop said he did not think it was appropriate to comment on that at this stage.
“There are players that are frustrated, but I'm going to leave it at no more than that. We will welcome discussions on these points but being mindful that if nothing material comes of this the players won't hesitate to push for final liquidation,” said Jessop.
At the end of the month EP Rugby will have to motivate to the court how the business rescue will take place. The court will ultimately have to decide if that application is viable and either lift the provisional liquidation order or make it permanent. Finalisation of the matter is expected to take place on May 31.
African News Agency