Wasps and Worcester relegated by RFU after failed bids

The Rugby Football Union have confirmed today that both Wasps and Worcester Warriors have had their ‘No Fault Insolvency’ applications rejected, therefore confirming their relegation from the Gallagher Premiership.

Both clubs were suspended over a month ago after going into administration but appealed, citing the impact of the pandemic as the reason behind going into administration.

While it was acknowledged by the RFU’s Club Financial Viability Group that Covid did have an effect, it was concluded in Wasps’ case that “insufficient evidence has been provided to enable the RFU to conclude that there has been “No Fault” on the part of the club or the directors.”

In Worcester’s case, it was said that “the RFU is of the view that the club has not established on the balance of probabilities that there has been “No Fault” on the part of the club (which includes its officers).”

The RFU statement reads: “The administrators for both Wasps Holdings Limited (WHL), the main operating entity of Wasps RFC, and of WRFC Trading Limited, the main operating entity of Worcester Warriors RFC have made ‘No Fault Insolvency’ applications under RFU Regulation 5 which would have the effect of avoiding the automatic relegation of a club’s most senior first XV team, therefore enabling that team to compete in the league in which it participated at the time the insolvency event occurred.

“Both applications cited the impact of the Covid pandemic as the primary reason for entering administration.

“The RFU’s Club Financial Viability Group, having considered both applications made a recommendation to the RFU Board that both applications are not accepted, and the Board has ratified that decision.

“To allow the necessary time to plan for the season ahead and provide certainty to Wasps and Worcester as well as the other clubs in the Championship, the timeline to agree sales of both clubs is 12 December.  The administrators have been aware of the deadlines from early in the insolvency process.

“Should sales of the clubs take place within the timeline and rugby creditors paid, Wasps and Worcester will begin the 2023-24 season in the Championship.”

RFU CEO Bill Sweeney said: “We are all deeply concerned by the insolvency of Worcester Warriors and Wasps rugby clubs.  We appreciate this decision will be disappointing for the clubs and their fans but it’s clear from the Club Financial Viability Group’s investigation that there were factors beyond Covid that resulted in the clubs entering insolvency.  This has reinforced the need for greater financial transparency between clubs, Premiership Rugby and the RFU to enable both organisations to have better visibility of how these businesses are run.  We are already working on plans with Premiership Rugby to explore how to improve the structure, governance and business model of rugby union in England and support the clubs in becoming more sustainable.  We are pleased that both clubs’ women’s teams have been able to continue and that the academy pathway in the midlands continues to give opportunities to young players.”

Both clubs have a right of appeal to an independent panel.