South African rugby side the Isuzu Southern Kings has withdrawn from all planned rugby competition for the remainder of the year, the chairman of the club’s board announced.
Andre Rademan said the decision was a “straightforward choice” after intense discussions regarding the club’s financial state of affairs for several weeks.
“This may not be a popular decision but in the current circumstances it is the right decision,” Rademan said.
SA Rugby and the Eastern Province Rugby Union (EPRU), the Kings’ two shareholders, both threw their weight behind the decision.
The decision was relayed to the Kings’ players and staff on Tuesday morning in the aftermath of an emergency board meeting on Monday.
“This is obviously very disappointing news for the players and management who, like all rugby professionals, were desperate to resume playing. But the board believed that further investment in 2020 with zero commercial return would be reckless in the extreme.”
The Kings were one of eight teams cleared by SA Rugby to resume training with a view of participating in a domestic rugby competition later this year. However, Rademan said that while the team could participate in the competition, it would come with serious consequences for the franchise.
“If we did so, it would require additional loans to the Kings or extra investment from the shareholders to the tune of R6.5m, which would add to the organisation’s existing substantial debt,” Rademan said.
Rademan added that existing challenges brought about by COVID-19 restrictions and other factors meant that its participation in Guinness PRO14 would also be forfeited.
“However, as there was no contractual requirement for the Kings to resume short-term participation in the Guinness PRO14 competition, because of air travel restrictions, and as the Kings had no other commercial commitments to honour, the most prudent decision was to withdraw.”
The Kings were due to play the Toyota Cheetahs as one of the PRO14’s provincial derbies when the competition resumed but due to the situation of the pandemic in South Africa, no date was scheduled.
Rademan added that ongoing uncertainty about competition formats and travel restrictions into 2021 meant the board will take its time in reconsidering its options and the current financial challenges.
“As a board we had been considering further short-term contracts to see the squad through to the end of the year,” he said. “But it became apparent that we would, for want a better phrase, be throwing good money after bad in the current global environment.”
The Kings have faced recurring management and financial problems in the past, especially a multi-million rand debt, which saw SA Rugby assume majority stake in the franchise in June after the Greatest Rugby Company in the Whole Wide World (GRC) failed to honour contractual obligations.
Local media reports also suggested that the Kings have a monthly wage cost of more than 3 million rand, in addition to the existing debt burden.
