Cape Town - The liquidator appointed to WP Rugby (Pty) Ltd says he will be seeking a purchaser for the business, but that he is allowed to “borrow monies” to pay the salaries of players and staff.
Chris van Zyl, of Mazars Recovery and Restructuring, has been put in charge of winding up the WP Rugby company after it was handed a final liquidation order in the Western Cape High Court on Tuesday.
Judge Ashley Binns-Ward dismissed the application by the only creditor opposing the liquidation, multimedia company Aerios, who has put in a claim of R72 million for services in respect of wi-fi, media and certain commercial rights.
Following the judgment, Van Zyl is now solely responsible for winding up the WP company. He wrote in an e-mail that the next step is to ensure that the players and staff are paid.
“The joint provisional liquidators now have the necessary powers to try to borrow monies to immediately prioritise payment of staff and players’ salaries together with all other support staff. This will preserve their contracts going forward,” Van Zyl said.
“If the joint provisional liquidators can find a willing and able purchaser to buy the business then and in such event, the new owner will no doubt contract with potential sponsors as soon as possible so as to preserve those sponsorship agreements.
“If we are able to sell the business on a going concern basis, then in terms of a sale of a business as a going concern, the staff contracts in terms of Section 197 of the Labour Relations Act will pass to the purchaser without exception. All the players, coaches and other employees will therefore be fully protected and will be employed by a successful purchaser.”
WP Rugby Union president Thelo Wakefield has previously said, following a provisional liquidation order being granted, that the “tipping point” of the whole saga was the contract with Aerios.
“Over time, certain commercial contracts with terms which have proved not to be favourable to WP Rugby (Pty) Limited were entered into, and which had the cumulative effect of putting both the company’s short-term and long-term sustainability at severe risk.
“The tipping point for our finances was the persistent and complex legal disputes relating to certain commercial, media and wi-fi rights with one partner in particular, Aerios, over the last year. This has hampered our ability to conclude key sponsorship and suite agreements which, in turn, has destabilised our relationships with key stakeholders and supporters, impacted materially on our cash-flow and ultimately led to the business of rugby being commercially unviable.”