Judgement reserved on WP liquidation

2016-12-12 14:18
Thelo Wakefield (Gallo Images)

Cape Town - Judgement has been reserved on Western Province (PTY) Ltd's application for liquidation.

This comes after Aerios were engaged in the next step of their legal battle with the commercial arm of the Western Province Rugby Union in the Cape Town High Court on Monday.

It was a day that Western Province were hoping would end differently, but Aerios' bid to prevent the liquidation from being granted was successful for the time being.

The provisional state of liquidation, however, is extended. 

Aerios, through advocate Chris Eloff, had claimed that WP’s sole intended desire through the liquidation was to get rid of Aerios as one of its creditors.

Aerios, who own the commercial rights at Newlands, have a reported claim of R72 outstanding from WP (PTY) Ltd.

Aerios is concerned that liquidation would leave them sidelined from future commercial dealings (their contract with WP is set to run until 2023).

Eloff told judge Ashley Binns-Ward that they had not been approached to engage in R46-R48 million worth of sponsorships, some of which were due to be secured in November.

A meeting between Aerios and Western Province that took place on October 25, Aerios says, was designed to reach a settlement between the two parties, but when that didn’t happen it signified the beginning of Western Province’s attempts to rid themselves of Aerios.

Aerios highlighted that Western Province’s overdraft with First National Bank (FNB), their other major creditor, had run close to its limit in 2014 and 2015 and that without Aerios on their books, Western Province would continue to run as normal beyond liquidation.  

Aerios also pointed to a court order in August that had instructed WP to include Aerios in all commercial negotiations, and they said that has not happened since.

The main concern for Aerios is that they will be removed from the equation should a liquidation be granted.

Earlier, advocate BJ Manca had pointed to Western Province's overdraft being reached with FNB and the fact that salaries this month were paid by a bridging loan from Remgro Sports Investments (RSI).

Manca then suggested that, in liquidation, there was no reason that Aerios would be worse off than FNB, Remgro or any of its other creditors. 

He said that the company at this stage was commercially insolvent and that there was no certainty that WP (PTY) Ltd would carry on as normal following liquidation.

Aerios Chief Executive Costas Constantinou told Sport24 after the day's proceedings that he was satisfied with how things had gone.

"The judge has got a lot to think about and I think we've given him that food for thought," Constantinou said, adding that Aerios would like to see out the rest of their contract with WP, which lasts until 2023.

"We've done a good job with Western Province and we'd like to continue with that."

Judge Binns-Ward did not give a date for when he would announce his judgement.

Read more on:    aerios  |  wp rugby  |  cape town  |  rugby

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