Otago go into liquidation
27 Feb 2012
It has been announced that the Otago RFU will be liquidated on Friday.
The news was confirmed at a press conference on Monday, which was headed by NZRU chief executive Steve Tew and Otago chairman Wayne Graham.
The 126-year-old union reported a loss of several hundred thousand dollars at its annual meeting in Dunedin. Tew added that there was no way out for Otago, which has a negative equity of more than NZ$2 million and was due to report another large loss. The union could also face expulsion from the domestic tournament, the New Zealand Cup.
The NZRU has already helped solve the Highlanders’ financial woes last year, and it has been decided that the national body will not to do the same for Otago.
‘The situation at Otago is unprecedented in our history. We have been working hard to avoid this outcome. That is why NZRU appointed a specialist late last year to develop a recovery plan and negotiate with affected parties and also why we provided interim finance to ORFU of NZ$200 000 over the last two months,’ Tew told reporters.
‘We were all prepared to help, but in the end the financial hole was just too big. The union had debts of NZ$2.35 million and was facing a significant shortfall in revenue this year. Quite simply, it has run out of money and could not trade out of its difficulties.’
Tew also stressed that Otago’s unfortunate fate had no influence on the region’s Super Rugby franchise the Highlanders, who are a separate entity.