THE dwindling band of players at Yorkshire Carnegie have been told the club are preparing to head into a Company Voluntary Arrangement (CVA) as they are unable to meet their financial commitments.
The ailing Championship outfit have failed to reach a severance package with all eight of the players under contract for next season and are now facing oblivion.
Carnegie were offering only a fraction of the total figure owed – believed to be over £500,000 – and three of the bigger earners have stood their ground.
CEO Gary Hetherington delivered the news to the players via email on Friday and the future of the club will rest in the hands of creditors and the RFU when the CVA is put in place.
If the creditors fail to agree to the CVA offer, Yorkshire Carnegie‘s trading company will be wound up.
Even if the CVA offer is approved, Carnegie will still have to prove to the RFU over the next couple of months that they are in a position to fulfil their Championship fixtures for the 2019/20 season. Until then, no recruitment can take place.
According to Championship regulation 5.3.9, Carnegie will not be hit with a points deduction as long as creditors are paid in full, or the outstanding creditors agree to waive or a repayment programme for outstanding amounts within six weeks of the insolvency event occurring.
Should Carnegie’s survival bid fail, the Championship will operate as an 11-team league next season as the deadline for redrawing the leagues has now passed.
For Carnegie fans and rugby in North, it is a sad state of affairs. With professional Rugby Union in Leeds on its deathbed and Newcastle relegated to the Championship, the onus is now on Sale Sharks to fly the flag for the region.
On Monday Yorkshire Carnegie released the following statement, in which Hetherington said: “The Leeds RUFC Board of Sir Ian McGeechan, Prof Paul Smith, Rob Oates and myself are responsible for the running of Yorkshire Carnegie and for making major decisions on the Clubs’ future and we are now awaiting a decision from the Shareholders of Yorkshire Tykes RUFC, who provide the funds to enable LRUFC to operate, before a further announcement can be made.
“But, it is fair to say the Club is in a critical position having lost its major source of funding and the Board is now working closely with the RFU and YTRUFC Shareholders to manage our current predicament and hopefully plot a way forward.”
JON NEWCOMBE / Photo: Getty Images
