Wasps merging with ACL

Discussion in 'Wasps' started by chiefdave, Jun 30, 2017.

  1. chiefdave

    chiefdave Well-Known Member

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    Wasps have announced they are merging with ACL and in the process it seems Andy Gibb is getting the push.

    It makes sense as a cost cutting measure as you can share staff, although there's no reason you can't do that with two separate companies in the same group. Doesn't this create a situation where if one part of the business fails the whole thing crashes down?

    I've been hesitant to agree with anyone who has spoken of Wasps move having not worked for them financially but its hard to see this as anything other than cost cutting and when you put it alongside Armstrong (Wasps chief exec) also going a couple of months ago, nothing happening at Higgs and, at least according to the Wasps fan in the office, not much in the way of 'name' signings to replace players who have left you have to wonder.

    Not saying they will be folding any minute now but are things doing as well as some would have us believe?
     
  2. NorthernWisdom

    NorthernWisdom Well-Known Member

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    /awaits Italia...
     
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  3. Liquid Gold

    Liquid Gold Well-Known Member

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    One small step towards the inevitable destination of them fucking off.
     
  4. Nick

    Nick Administrator

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    I thought they had been pretty much doing that anyway?
     
  5. Terry Gibson's perm

    Terry Gibson's perm Well-Known Member

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    Forty seven minutes and no Italia is he still with us.
     
  6. chiefdave

    chiefdave Well-Known Member

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    I assume they've been sharing staff between the two so is merging just to get rid of the big salaries at the top.
     
  7. Moff

    Moff Well-Known Member

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    I have said before how they are not going to replace Beale one of their marquee signings who has left. They came out with some hot air about it, but whichever way you dress it up its cost cutting...and from what I hear necessary too. Such a shame. :D
     
  8. Terry Gibson's perm

    Terry Gibson's perm Well-Known Member

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    Ian Beale is it because he lost the weight
     
  9. oldskyblue58

    oldskyblue58 CCFC Finance Director

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    Will wait for the accounts to come out but even profitable excellent businesses ( not saying this is ) should look to keep costs down and avoid unprofitable duplication. So it could be a sign of struggle or good housekeeping at this stage.

    Not sure what purpose ACL serves but haven't most staff been transferred to wasps in any case ?

    Doesn't the article say they are retaining the legal entities so the change is purely operational

    My own opinion is that things have not gone exactly to plan but it is far from a disaster. Just a feeling no evidence to back it up. Like I said we will know more in October
     
    Last edited: Jul 1, 2017
  10. Gint11

    Gint11 Well-Known Member

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    Give it 1 or 2 more seasons and attendances will drop to a poor level other than big games against the tigers etc. Taking a club away from its roots never works in the end.


    Sent from my iPhone using Tapatalk
     
  11. martcov

    martcov Well-Known Member

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    We have been told we need revenue from stadium ownership and that there will have to be an opco and a propco.

    If Wasps, who have this, still fail then it doesn't bode well for us.

    Is stadium ownership a guarantee of success? Admittedly we would probably make the stadium naming rights more valuable if we owned the Ricoh, but as much as it would be satisfying to see an out of town club fail, on the other hand it would show stadium ownership in Cov not as financially viable as hoped.
     
  12. oldskyblue58

    oldskyblue58 CCFC Finance Director

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    That assumes that the attendance income is the main part of the income. It is significant but it is approx half of the rugby income (the other half being guaranteed central distribution) but rugby income is one third of total income in round terms. Because of the other income wasps have a significant buffer. The rugby side because of wage costs is not profitable but the stadium operation would now seem to be..... but the rugby wages of most clubs is a problem. Wasps might reduce attendances but they will still have significant numbers and income even with a 50% drop which means wasps dealing with the wages issue or owner investment or loans
     
    Last edited: Jul 1, 2017
  13. wingy

    wingy Well-Known Member

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    Would a move like this help in defending an court cases?
    Would it help if there were to be refinancing or a floatation.
    Is there any vehicle within the structure where If it goes south the other survives and carries it forward?
     
  14. oldskyblue58

    oldskyblue58 CCFC Finance Director

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    I would think that as the long lease has term where it reverts to the original if wasps become insolvent ACL will remain as it and ACL 2006 have the rights to the first lease. To transfer the lease requires the freeholder permission not impossible but I think unlikely. The original companies remain as I understand it but it is the day to day operations of those companies that is being pulled into one company. Seems sensible course of action to me. Yes it saves cost. Is it a fire fight exercise I am not sure yet

    Not sure how it would affect the legal cases because those deal with things as were in 2014 not now

    Does it affect refinancing ? Possibly in terms of proving ability to pay because costs will drop but I don't think in a significant way However the biggest effect on raising finance is the increased lease value of 60m which increases the equity available and therefore the choice of finance options to say repay the bonds
     
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