Rebels face more hurdles despite $25m rescue plan, call on RA to show support and reveal hand as court battle looms

A vote to save the Melbourne Rebels may prove to be only a stay of execution, with the debt-ridden Super Rugby Pacific club facing further hurdles in its bid to stay alive.

The positive vote in favour of the Rebels came as the Super Rugby franchise’s head coach Kevin Foote hit out at Rugby Australia, saying they felt abandoned by the governing body.

Creditors on Friday voted to accept a proposal by a private investor group that includes current directors rather than liquidate the club, which has debts of more than $23 million.

The consortium, involving former Qantas chairman Leigh Clifford, proposed a Deed Of Company Arrangement (DOCA), which guaranteed employees 100 per cent of their entitlements but would leave unsecured creditors with as little as 15 cents to the dollar.

Committing to an investment of more than $25 million over the next five years, the plan involves a move to Melbourne’s western suburbs to share facilities with A-League club Western United.

The proposal was recommended by PwC voluntary administrator Stephen Longley, who also said in his report last week that the club may have operated insolvent for more than five years.

It’s believed Longley had the deciding vote on Friday after the creditor vote was tied.

Rugby Australia chief executive Phil Waugh has been urged to show the governing body’s hand regarding the Rebels’ future. (Photo by Daniel Pockett/Getty Images for Rugby Australia)

However, the DOCA is dependent upon the Rebels regaining the Super Rugby participation licence from Rugby Australia (RA), which took control when the club entered voluntary administration in January.

RA, which has propped up the club this season, taking over the wages bill for players and staff, has given no indication of its plans for the club, who joined the competition in 2011.

It’s believed RA voted against salvaging the club, with the Australian Financial Review reporting that the governing body claimed the independent report by Longley was biased towards the former directors. The Roar understands RA voted by proxy.

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The Rebels’ second obstacle is the Australia Tax Office, which also voted against the proposal, a source told AAP.

As well as the licence, the new deal is dependent on the ATO releasing the directors from their personal liability over the club’s $11.5 million in tax debts.

The likelihood is that the matter will end up in the courts, leaving players, coaches and Rebels staff in limbo.

The meeting occurred just hours before the Rebels were scheduled to host the Blues in a Super Rugby Pacific match at AAMI Park on Friday night. Ultimately, the Blues put got over a messy first half to run away with the match 38-11 as they scored 31 unanswered points, including four second half tries.

Rebels captain Rob Leota reacts during his side’s heavy loss to the Blues at AAMI Park on May 03, 2024. (Photo by Asanka Ratnayake/Getty Images)

There are just four rounds of the regular season left for the Rebels, with the franchise franchise on track to make the finals for the first time in their history despite their second straight loss.

Consortium spokesperson Georgia Widdup welcomed the successful vote and urged the governing body to support the new plan for rugby in the state.

“The Melbourne Rebels are an integral part of the sporting fabric of the state and play a critical role in making Melbourne the sporting capital of the world,” she said in a statement.

“Today’s decision ensures the women’s and men’s club can progress plans for our financially sustainable future.

“There is still a lot of work to do, but with the vote out of the way and a lot of community and government goodwill behind the club, we can finally get excited about what the future holds, and we urge Rugby Australia to support rugby in Victoria.”

But speaking following the loss to the Blues, Foote, who saw the Western Force culled during his time at the Super Rugby franchise, called on RA to show their hand.

“I don’t know what their intentions are,” Foote told AAP.

“I know they voted liquidation today and last week we were told that they were happy that there was a DOCA (Deed Of Company Arrangement) and now liquidation, so it would be great to hear something from them.”

Representative from the Rugby Union Players Association were in Melbourne last week to talk the club through the rescue proposal but RA haven’t been seen since in months.

Kevin Foote says the Rebels don’t feel supported. (Photo by Hagen Hopkins/Getty Images)

With coaches to be receive just one more pay cheque, Foote said the entire club was feeling the pressure.

He previously said he was hiding the possible demise of the Rebels from his young son because he knew how much the boy would worry.

“Staff and players, it’s the human element,” he said.

“There’s definitely people under massive stress, everyone is under stress as a matter of fact.

“It speaks again to their performance tonight – guys have done this since day one, before even the season kicked off they’ve been under this pressure.

“Are people feeling supported? I’d say no.”

AAP with staff writers