London Irish administrator Lee Manning has told Sky Sports it is only “a matter of time” until the next Premiership Rugby club goes bust, saying the game’s financial model needs to be “radically changed”.
Last month, news broke that a consortium led by former F1 team owner Eddie Jordan had bought London Irish out of administration.
London Irish went bust in June 2023 with more than £30m of unpaid bills and have been looking for investment since – a development which forced their relegation from the Premiership and removal from the English rugby pyramid.
A consortium led by former Formula 1 team owner Eddie Jordan bought London Irish out of administration
The club were the third outfit from the Premiership in less than a year to suffer such a fate after Worcester Warriors and Wasps.
Speaking to Sky Sports News, Manning is of the belief more will follow: “There are only 10 teams [in the Premiership]. We’ve seen Worcester, Wasps and London Irish go to the wall and it’s been some years as well, so they’re not there waiting on the doorstep to jump back in.
“It only takes one other club to fail, perhaps two, and where’s the viability of the league? Where’s the attraction of the league?
“In the 2022/23 season, not a single club made a profit. The smallest loss was Gloucester at £550,000 and seven out of the 10 clubs have a negative balance sheet, the largest of which is Bristol Bears at around £34m.
“Sale Sharks are around £1.9m so there are only three clubs with a positive balance sheet: Northampton, Harlequins and Gloucester. There is little prospect of profitability in the medium term and therefore considerable risk of other clubs going to the wall.
“I think it is [just a matter of time]. Unless the game’s financial model can be radically changed.”
Rumours have circulated London Irish will seek to join the URC, where clubs from Ireland, Scotland, Wales, Italy and South Africa compete, and may even base themselves in Ireland.
Such an ambition has roots in the fact Manning says RFU regulations around insolvency are unfair in preventing clubs to return to the top tier, or, he says, even the second tier.
“I spoke to the RFU and said: ‘So what we’re effectively selling is a situation where someone’s got to come up with a methodology of paying $2.7m to creditors, plus paying something for the club itself, not being able to play any competitive matches for the following season, and has been relegated to the Championship. So it would be starting the season after next in the Championship.’
“They replied: ‘No, that’s not right, Mr Manning.’ Well, why? ‘The club’s gone through a season and it hasn’t played any matches and hasn’t had any points, therefore it’s relegated again.’ My face dropped, as you can imagine.
Wasps, London Irish and Worcester Warriors each went bust all within a year
“How can that make it attractive or viable for anybody to want to now pay £2.7m, have to wait a year, and then start in League One with no income whatsoever?
“They’re [regulations] unfair. They stifle the ability to rejuvenate. They punish parties who have invested significant sums in trying to make a rugby club viable.
“The supporters have also lost out because these hurdles are put in the way to make it extremely difficult to resuscitate a club for an interested party.
“I understand and everybody knows when they enter into a process there is a rule about relegation. It’s a consequence. In football there are points deductions and that may lead to relegation. Rugby knows the rules of engagement.
“But to introduce on top of that the sanction of suspension and another relegation when actually the club hasn’t even been able to play makes no sense at all.”
London Irish were the third Premiership club to perish and administrator Lee Manning says it ‘is a matter of time’ before another club suffers the same fate
Manning also confirmed he believes Jordan is very interested in looking into London Irish joining the URC but added the RFU would have the ability to veto such a move.
“My understanding is there is an intention of seeing if they can join the URC and I think that might be the case for Wasps as well because there’s no viable entry route into the Premiership.
“But I’m not party to the criteria they have to meet: the business plan, having to show they’ve got adequate finance, that they’ve got a stadium to play in, a training ground etc. And also I do believe there needs to be the sanctioning of the RFU for that to proceed anyway and I’m certainly not party to their mindset.
Manning revealed he believed the RFU possess the ability to block any potential London Irish move to the URC
“London Irish in Ireland? That would be interesting. I’d have to change the name.
“In those circumstances [RFU blocking London Irish from joining URC], I don’t know what plan B might be. Whether there would be some other league that could be formed or some international competition, but it potentially leaves them still with a brand, still the ability to launch a club, but where would be up to them.
“We’re not party to their thoughts or discussions, but we’d be very hopeful they do get into the URC or a similar league.”
Sky Sports News has contacted the RFU for a response.
