Mon 3 Aug 2020 | 07:54

Financial mismanagement clips Falcons' wings

Financial mismanagement clips Falcons' wings
Mon 3 Aug 2020 | 07:54
Financial mismanagement clips Falcons' wings
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COVID-19 is being put forward as the official reason for the cash crunch and imminent liquidation of Valke Rugby (Pty) Ltd – the commercial arm of the Falcons Rugby Union.

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However, it has emerged that suspected ‘financial mismanagement’ and other irregularities within the company, (Pty) Ltd, is at the heart of the issue.

As reported by @rugby365com last Friday, the Valke company is not in a financial position to pay players their salaries for July.

It was also confirmed that the board of the company resolved to ‘voluntary’ liquidate the company.

In a media release issued at the weekend, the company said COVID-19 “claimed another victim”.

Competing as the Malaysia Valke, based in the Malaysian capital Kuala Lumpur, the team used the Rapid Rugby tournament – funded by Australian billionaire Andrew Forrest – as their main source of income.

Since the Perth-based venture was canned in April, there has been no income for the East Rand-based Falcons.

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“The owners of Global Rapid Rugby injected money into the company to pay the salaries of players,” the statement said.

However, in a letter to the trade unions Sports Employees Unite (company/union staff) and MyPlayers (players) Ettienne de Lange, the Chief Executive Officer of the union and a director of the company, revealed that other factors also played a critical role.

“It is by now common knowledge that the directors of Valke Rugby resolved on 4 June 2020 to place Jurie Coetzee on precautionary suspension in both his capacity as director and Chief Executive Officer of the company – pending the outcome of an investigation into suspected financial mismanagement and other irregularities within the Company,” the letter to the trade unions said.

De Lange then assumed ‘interim responsibility’ for the day to day management of the company, whilst Rudi Joubert continued to assume responsibility for the player affairs.

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De Lange made it clear he was not acting as Chief Executive Officer of the company, but is merely assisted with the day-to-day management of the company whilst Coetzee is suspended and the investigation ongoing.

“Investigations into the affairs of the company, following Coetzee’s suspension, revealed that the company is in serious financial distress, so much so that it is factually and commercially insolvent,” the letter to the trade unions read.

“On Tuesday, 28 July 2020, the board of the company resolved to voluntarily liquidate the Company.

“This matter is currently being attended to by the Company’s attorneys.”

(Continue below … )

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The Falcons Rugby Union was originally founded in 1947 and was previously known as the Eastern Transvaal Rugby Football Union.

The ETRFU merged with the Vaal Triangle Rugby Union to form the Gauteng Falcons Rugby Union in 1995.

In 2006 the Falcons won the Vodacom Cup domestic competition, the only honours in the history of the union.

Eastern Transvaal played against Transvaal in the 1972 Currie Cup Final – losing 19-25 at the Pam Brink Stadium, Springs.

According to the weekend statement, the Falcons Rugby Union is not experiencing financial problems and financial commitments to employees of the union are being honoured.

@king365ed
@rugby365com

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Falcons statement

Falcons statement

 

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