VIDEO: Disentangling WPRFU, WPPR and the commercial chaos
The Stormers’ new equity partner, Red Disa, will look after the financial well-being of the franchise’s professional teams.
However, they will not service the large debt accrued by the Western Province Rugby Football Union since 2018 – which now sees all of the union’s properties bonded to the Flyt property group.
That part of the contentious conundrum will be solved by the South African Rugby Union-appointed administrator Peter Jooste.
Last week Red Disa consortium concluded its equity deal to secure a controlling shareholding in Western Province Professional Rugby.
Red Disa – consisting of the Cape Town-based investment holding company Fynbos Ekwiteit, Ardagh Glass Packaging and Marble Head Investments – have pooled their resources to save the Stormers from drowning in debt and being killed off by petty infighting.
In part two of his one-on-one with @king365ed Fynbos Ekwiteit’s Johan le Roux elucidates the split between WP Professional Rugby (Pty) Ltd and WPRFU, as well as commercial chaos that once lingered in Cape Town.
Le Roux explained that because the names are very similar and the history of the two entities are intertwined.
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“The union [WPRFU] owned 100 percent of the company [WPPR], with the same people managing both at various stages,” he told @rugby365com.
“The difference between the two was not well articulated or understood.”
Le Roux said Red Disa invested ONLY in the company – WPPR.
“The company owns all the trademarks and the IP you need [in order] to manage the team,” he added.
The coaching staff, commercial staff and the players are all ’employed’ by the company.
“We manage the Stormers team, the Western Province [senior] team and the Under-20 team – the post-school age-group teams.”
The union (WPRFU), which has a 26 percent shareholding in the company, still controls all the legacy properties – like Newlands.
“We know there is a debt against those properties,” he said of the bonds registered by Flyt Property Investment on all the WPRFU properties.
WPRFU already owe the property company, Flyt, about ZAR200-million for a loan to WPRFU in June 2020.
“The union’s mandate is to support and manage community rugby,” Le Roux said.
This includes not only club rugby, but school rugby (the Under-13 and Under-18 Craven Week side, the Under-16 Grant Khomo week team), and the women’s team.
The union, WPRFU, will have representation on the company’s board – the right to nominate two directors.
“Their players feed into our system,” he told @rugby365com, adding: “So it is very important to have a strong working relationship.
“Their financial situation in regards to the Newlands ownership and the debt against that is a level above the company.
“It doesn’t affect us [WPPR] in any way.”
Le Roux also revealed that the contentious issue of trademarks and IP was ‘signed over’ to the company by the clubs when they first approved the equity deal back in August last year.
“Essentially it was to put all the parts into the company that we need to operate the company,” he explained.
“The most contentious bit was the trademarks.”
Le Roux explained that the trademarks were previously owned by the company, Western Province Rugby (Pty) Ltd (WP Rugby (Pty) Ltd, before it was liquidated in 2016 in the well-documented legal dispute with Aerios.
At the time, the trademarks were transferred to the union as part of the liquidation process and Red Disa has now asked that the trademarks return to the company (now WPPR).
“That [trademark ownership] was part of the transaction from the outset,” Le Roux said, adding: “The transaction that was approved by the clubs included moving those trademarks [back] to the company.”
@king365ed
@rugby365com
* Don’t miss part three of this #EXCLUSIVE interview, when Le Roux chats about Red Disa’s plans for the Stormers and WPPR’s debt to SARU.
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