Otago stave off administration - for now
March 2, 2012
All Blacks captain Richie McCaw is battling to preserve rugby in the Otago region © Getty Images
The Otago Rugby Football Union (ORFU) has agreed to a request by the New Zealand Rugby Union (NZRU) to delay liquidation proceedings in the hope that the cash-strapped region securing a financial lifeline.
The New Zealand Herald reports that the board of the ORFU were due to file for liquidation on Friday but NZRU chief executive Steve Tew has revealed that they now plan to defer the application by one week to allow more time to work with potential sponsors, benefactors and financial institutions in a bid to service their NZ$2.35m debts and on-going running costs.
"The situation is still very grave but a number of people are still working on a solution and hopefully this buys some time," said Tew. "The seriousness of the situation hasn't changed. We do not want to end up in a situation where we are back here in six months time. We need to have some ability to deal with the debt and with the long term sustainability of the Otago union and neither of those are straight forward.
"The key parties have been talking since Monday and have identified some options that warrant further examination,'' Tew said. "It makes sense for the union to delay proceedings to allow these parties more time to undertake proper analysis."
The newspaper adds that the NZRU, Dunedin City Council, Dunedin Venues Management Ltd and the New Zealand Rugby Players Association, represented by All Blacks captain Richie McCaw, have all been working through details of the package with
"Obviously things are at a very delicate stage, so we are not in a position to discuss the shape of any deal. However, we are only considering arrangements that will put the union on a sustainable long term footing. This is complicated and any deal has to be multi-faceted involving input from all of the union's key partners.
"This doesn't change the fact that the financial picture remains very bleak, there are some significant hurdles to be overcome, so the outcome is by no means certain, but all parties are working hard on these proposals.''
Earlier this week, it was revealed this week that the 131-year-old ORFU owed the Dunedin council nearly NZ$400,000 in unpaid rent and other charges for Carisbrook since selling the old ground. The Union's participation in this year's ITM Cup remains in doubt although the region's Super Rugby side the Highlanders is unaffected having previously been made into a separate legal entity.
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