CAPE TOWN (Reuters) - South African Rugby stepped in on Monday to take over managing control of ailing PRO-14 team Southern Kings, after their majority shareholders ran into cash flow problems.
SA Rugby said it had taken back a 74% shareholding in the franchise, which had been sold to a consortium of local businessmen last year.
“It is our last resort and we are keen to explore ways to return the shareholding to another’s hands,” said SA Rugby president Mark Alexander.
“The next step is to appoint a new board to oversee the franchise’s affairs and ensure the team is match ready for when we are able to resume playing.”
All staff and players have been retained and a finance team appointed to work with franchise administrators on ensuring salary payments are made and business needs addressed, SA Rugby added.
Players were paid late in April in the first signs that the previous shareholders were struggling to meet financial obligations.
“The decision ensures the Southern Kings will participate in PRO14 and/or any other competitions that may be established within the constraints of the COVID-19 pandemic lockdown,” the statement said.
For the moment, there is little clarity on a re-start for rugby in South Africa in the wake of the novel coronavirus lockdown.
Writing by Mark Gleeson; Editing by Christian Radnedge