News24

Lions 'hopelessly bankrupt'

2012-01-27 10:30

Cape Town - Reigning Currie Cup champions, the Golden Lions, are hopelessly bankrupt, according to a report in The New Age website.

Ellis Park Stadium, home of the reigning Currie Cup champions, is more than R70m in the red.

The official figures outlining the sorry state of the financial affairs show the total amount owed to creditors in fact exceed the hundreds of millions of rands of assets on the books of the Golden Lions Rugby Union (GLRU).

Deon van der Walt, corporate finance executive of IT billionaire, Robert Gumede’s, Guma Group said in papers filed in the South Gauteng High Court that GLRU are “hopelessly insolvent, both factually and commercially”.

In the liquidation application of the Golden Lions, Van der Walt said Gumede and Ivor Ichikowitz provided more than R10m for Lions president Kevin de Klerk to pay the Lions rugby players and his staff salaries in December 2010 and January last year.

Guma TAC, consisting of Gumede’s Guma Group and Ivor Ichikowitz’s Transafrica Capital, was announced in October 2010 as the Lions new equity partner, but the short-lived marriage ended abruptly when Gumede pulled the plug last year.

The two businessmen then claimed that the GLRU only wanted their money, but was not interested in their plans for meaningful transformation. They accused the Lions’ bosses of being “stuck in the past” not wanting to move to a new future.

According to Van der Walt’s statement, Guma TAC made it possible for the Lions to become the 2011 Currie Cup champions. As part of the agreement for 49% shares in the rugby union, R171 000 was paid as part of the salary for the New Zealand conditioning coach, Wayne Taylor.

“By June 2010 when the applicants (Guma TAC) started negotiations, the Golden Lions had lost all their 2010 Super Rugby games and all their matches in the less competitive domestic Currie Cup competition up to that date,” Van der Walt said.

“The applicants’ funding allowed the Lions to pay for the salaries of the players, coaches and staff, to buy international and local players and employ other value adding staff to improve the team’s performance culminating in them winning the Currie Cup in 2011.”

Referring to the poor state of financial affairs, the Lions’ auditors, PricewaterhouseCoopers wrote in May 2010 that the ability of the company to continue depended on the ability to return to profitability.

Van der Walt included the financial figures for the 2007 to 2010 financial years describing it as a “dramatic and continuing decline in the factual solvency”.

Sport24

Comments
  • Lionel - 2012-01-27 10:33

    Eish but thats not a good sign at all,Lions are playing good rugby and don't need this kinda thing now!!!!!

  • Piet - 2012-01-27 10:38

    "..the Lions’ auditors, PricewaterhouseCoopers wrote in May 2010 that the ability of the company to continue as a going concern depended on the ability to return to profitability." WOW, that must have taken a lot of work, hours, money and brainstorming to come up with such a brilliant piece of reporting. Its like saying "..the ability of the Lions rugby union to defend the Currie Cup depend on the ability to play good rugby"

      Paul - 2012-01-27 10:45

      ...or, the team that scores the most points will win the game. Friggin overpaid bean counters; almost as bad as Blue Bulls supporters and politicians.

      Deon - 2012-01-27 12:51

      Many people, companies and the state have a problem with this. Spend less than what you earn.

  • adrian.bruwer - 2012-01-27 10:46

    Come on Stormers - here's an opportunity to buy decent props!

      Clive - 2012-01-27 11:19

      After getting so many lions the last few years they expected to win the curry cup, came close but still so far away. LOL So maybe getting the whole side might work.

      Deon - 2012-01-27 11:41

      They are a bit "thin" upfront, you can not win many games unless you compete upfront.

      Clive - 2012-01-27 13:09

      Deon you are 100% correct it has always started upfront, like good solid foundations

  • Johan - 2012-01-27 10:48

    This Guma group have sour grapes or they need some cash if they are that desperate for money....its going to be a long story in any case....I am sure the Currie cup last year boosted their income....and the expectation of fans.....if fans come to the stadium and the Lions start winning some more super rugby games....Guma will get their cash and the Lions will survive!

  • Phumi - 2012-01-27 10:53

    Mismanagement and incompetency by those who are a stumbling block to transformation. Let them eat cake!

      DuToitCoetzee - 2012-01-27 11:46

      I think the possibility of less supporters in stadiums and not the best deals in sponsorship made them fall short on income. Maybe even a bit of buying dud or unnecessary players and made a few wrong choices. This can all be drawn back to the way they played the previous years.( pre 2011) Maybe last years CC will turn things around. I hope so for their sake.

      Deon - 2012-01-27 13:00

      The team played much better after Gumede etc. left. Keep politics out of sport, it rarely works.

  • brian.heunis - 2012-01-27 10:58

    "According to Van der Walt’s statement, Guma TAC made it possible for the Lions to become the 2011 Currie Cup champions." SERIOUSLY?

  • willem.leroux2 - 2012-01-27 11:05

    lions bly bo ons kom almal een of ander tyd in dieselfde boot en kom daar uit

  • Shaun - 2012-01-27 11:07

    Funny how the bankrupt can still win the Cirrie Cup! Well done Lions. Perhaps the Sharks could learn from them?

      Byron - 2012-01-27 11:39

      Wow if you think the sharks can learn from the lions you must have only started watching rugby half way through last year! Since professional rugby has been around the lions have faired generally very poorly considering their resources. The only thing another union can learn from the lions is how not to run a union! For good management the Bulls and the Sharks are seriously top

      David - 2012-01-27 11:56

      Shaun. I am a Sharks supporter and i can say that after a long drought, the lions deserved to win the cup.They took the chances they were given and used them, but for you to say that the Sharks could learn from them is a grave mistake. There are two teams that won that day, Lions and SA Rugby.

  • Paulo - 2012-01-27 11:12

    so glad the Gumede and co are no longer involved with the lions. Their actions just show you that they never ever had the interest of the province at heart. Lions till i die.

  • colin85 - 2012-01-27 11:33

    So let me get this straight, first they wanted to team up with the lions, now, despite knowing they can't afford to pay them, they are trying to get them liquidated so the team no longer exists - way to go for the transformation and hopes and dreams of the townships around joburg!

  • Bernard - 2012-01-27 11:38

    Mmm... at this rate the Kings may be playing in the 2012 Super 15 rather than the 2013 comp!

  • legndkilla - 2012-01-27 11:52

    people plse dont entertain Idiotsak's comments cos he isnt a true supporter, as we all know true supporters watch the game and admit the faults and praise the good wether their team wins or loses, its far too early to be talkin bout "our year" lets see mid table and then talk again, make no mistake im a treu wp supporter silver or no silverware !!!

  • John - 2012-01-27 12:03

    Board room fights should stay in the board room and the courts no need to get the media involved. The Guma team should have finalised the terms of the deal before they advanced money i do not see them getting this cash back as they reneged on a deal by walking away from a partnership, good luck to them....the lions will survive make no mistake however its no secret that they are in a financial mess....

  • Gavin Jaar - 2012-01-27 12:16

    How do expect someone 2 invest millions of rands and dont have a say in how things should be run?lions execs should think about the future of the lions!

  • Johan - 2012-01-27 12:19

    very sad . . . . .

  • Schalk - 2012-01-27 12:34

    Sorry... dont worry join the CHEETAHS!!

  • Bokfan - 2012-01-27 12:37

    Strength to the Lions. What do iskowits and guma tenderpreneurs inc. know or care about rugby. Lets hope Thuli Madonsela nails them both for corruption, fronting and fraud.

  • John - 2012-01-27 12:39

    You cannot make money if you dont fill the stadiums! Jeez it's not like it's rocket science. Now is not the time to pull the plug. The crowds are coming back with this new Lions outfit playing great rugga. GO THE STORMERS!

  • daniersa - 2012-01-27 12:42

    Think Gumede will make every union re-consider an equity partner. He obviously will not stop. Sure there are chairs and tables for these conversations. He is being the nasty divorced partner telling stories. It's a shame if you think back to the promise all of this had last year. Hope the Lions continue to survive his onslaughts. He probably wants commission for his part in the MTN sponsorship.

  • dominique.dhotman - 2012-01-27 12:49

    shame, real pity.

  • Francois - 2012-01-27 13:25

    sommer by taute now ek se.....

      Shoosh - 2012-01-27 17:43

      Is "sommer" by Taute a new book or what?

  • Pete - 2012-01-27 13:25

    so it looks like its back to the kittens for the lions. no money to pay the top players.they will get hammered every game again and no body will come and support them.

  • comrade.zondi - 2012-01-27 13:40

    Eish Just what we expected. As soon as it was announced last year that a darkie was involved, we knew that they would fail. It happens every time.

  • Cobus - 2012-01-27 13:54

    The story of Province winning the most CC ever is so old. Please refer to history or even google it. They have been "awarded" the CC more yes, but not won it more. Check on History of CC.

  • pages:
  • 1