Exclusive: Rebels threaten Civil War as peace talks with RA end in another blow for Super Rugby

Mark states: "However, one source suggested that rather than back down, the Rebels would now start “a civil war” – indicating they planned to drag RA into a drawn-out court battle." Its all well and good to sabre rattle but you have to have substantial funds to litigate in any proceedings let alone those you think that you can draw out - pure and simple. As insolvent claimants, the Rebels would also likely have to put up security to cover RA's costs. So where does the war chest come from? Nowhere! And remember they are under administration and so the administrator would be running the show, if the administrator decided there is one to run. Time to go Rebels. And, as I said below, time for RA to save the playing group, pronto.

If there's even one piece of paper with an RA signature on it agreeing to $n dollars to the Rebels, then RA should pay that money to the Rebels, or be sued- either by the Rebels or the Rebels creditors. The Rebels directors have messed this up since they day Harold Mitchell donated the team to Rugby Victoria. He'd be turning in his grave right now, but the Rebels can't be the fallguys here. RA wanted them wound up immediately, and now we know why. The Federal Court gave the Rebels an extension to come up with a DOCA based on this claim the Rebels have against RA.

They are now Jez/ Brumbies are in trouble.

Generally speaking, if a company trades insolvently and then is put in to liquidation, directors can be ordered to pay the debts of the company. That is so because the directors had the running of the company and have an obligation to ensure it can pay its debts at all times. If the company can’t pay, the directors should put the company into administration as soon as they know the debts can’t be paid. That was not done and. It would seem, the company continued to trade while insolvent. There is a lot of money at stake for the directors. The Rebels debts are a lot to pay from directors personal funds. Few people can take that sort of financial hit.

Yeah. The funding gap isn’t huge though. Trim the books and maybe let go of a top player each, and clubs could stand on their own two feet. That said, given it would reduce squad depth, we would likely need to free ourselves from SR and have a national comp with a level playing field. More competitive matches, more Au derbies, sustainable clubs and a guaranteed Au winner. I’d watch that! Add a trans-tasman series at the end to challenge players in the lead up to the test window and you have a decent model to build from.

Agreed. Brumbies sold Griffith Club House (in 2013?) to stay afloat then returned to profit in 2017 following the Deloitte Review and cutting their admin, hospitality and other expenses. Brumbies just get their $8m share of TV revenues from RA each year.

NZ is hard to tell because NZR centrally contract players, so in 2022 they only gave $3m to SR clubs (total combined). That said, in 2022 NZR had broadcast revenue of $102m, compared with an $82m player pool across men, women and 7s teams. So on the face of it, it sounds like higher broadcast revenues gives them an overall more sustainable position than in Au.

I hear what you are saying - the SR Franchises are only 'profitable' due to being bankrolled by RA. Basically, SRP is a vehicle funded by RA.....any drop in RA funding, and the Franchises are in danger of going under.

In 2022 RA paid $54m for SR high performance funding, player payments and RUPA. I understand the intent is it is paid by the $49m in broadcast revenues (SR got 891k viewers per week vs a similar number per Wallabies test). Take out RUPA costs and SR broadcast revenues, and you’re probably still left with a subsidy to clubs of maybe $4m per year each? As for club finances, I don’t think Rebels and Force report publicly but the Reds books are healthy due to Ballymore grants, and Brumbies have been stable since 2017 and their equity exceeds debt. Tahs have also been profitable each year but with only $4m in equity against $20m debt, half of which is due to a long-term lease for Allianz. So overall the 3 original clubs are pretty stable (subject to RA not cutting payments…).

I agree, I think the risks of trying to start a new competition are pretty immense. It would cost a great deal of money to get it off the ground, with no guarantee of success. Despite being poorly managed, especially on the Australian side, Super Rugby has been somewhat sustainable. We have tried a domestic competition twice, both failed because they were not financially viable.

And to add, it seems they do expect a return. They’re suing RA to get that return. Scumbags.

So they’re unsecured creditors? Agreed. Tried to grow the game? Maybe. Or did they just mismanage the club, paper over their ineptitude with cash loans for things that didn’t pay off, and now expect the rest of the sport to repay them? Unless RA approved these loans, why should they be compelled to repay them? It seems the Rebels’ directors banked on being too big to fail.

I agree with the premise of the comment but one point here that's simply untrue is where you write RA bailed out Brumbies. RA have bailed out the Reds, Waratahs, Force and Rebels. Done it a couple of times each. RA have never bailed out the Brumbies.

I tend to agree, regarding losing on SRP to make it back on the Wallabies - but it seems the franchises have had to wear much of those (SRP) losses. After many years of (income minus costs) losses, I can see how they end up being up double digit.....that doesn't explain the ATO debt of course.....anyway, so much that we don't know.

"Go quietly Rebels – you won’t be missed by anyone except your few rusted on fans” Couldn't the same be said about Rugby Union in general in Australia? Good luck to the Rebels - hope they bring down everything with them.

Not ideal but but hopefully he can get back to his best in the next few weeks

Hard to disagree with that RB. I guess they try and make enough off the Wallabies to cover the shortfall/s. Is NZRU in the save situation? i.e. lose money on SRP but make it on the ABs. Where’s @Highlander when you need him…

Wasn’t great was it.

A couple of weeks back I expressed sorrow and concern for the Rebels players and their fan base as no one wants to see rugby union diminished anywhere. However, it is now time for the grass roots of Rugby in Victoria to stand up and disassociate themselves from the incompetents that run their sport in their State. The threatened Court action is not really about RA or broken promises or supporting the professional players and their supporters in Victoria. It is simply a strategy aimed at clawing back money to cover the level of personal liability facing the Rebels board members who have acted without the competence that is expected of professional directors. The Rebels have never been financially viable - just look back to the financial shambles they were in circa 2013 and so a clawback of $8million will still leave a black hole of $14 million + future financial needs. A franchise that, for example, contracts a player and then can't even cover his relocation expenses just needs to go and to go quickly. I don't want to see Oz lose a team in SRP as when a team is dismantled, as per The Force circa 2018, it takes miracle in the form of a Twiggy Forrest for it to be reformed. So as a team, the Rebels should be rebranded and somehow be relocated en masse to a rugby heartland area under a new administrative and coaching framework. RA should set up a task force to achieve that outcome as a priority and spend money on that purpose rather than pouring it down the Rebels' bottomless sinkhole.

Well noted and understood. But the SR Franchise (each of them) shortfall of income to operating costs looks to be around $8mio per year. How can a competition operate under that structure? Even cutting players salaries won't make a huge dent in that!