SHOCK OSPREYS NEWS - Seven-figure 're-financing' prompted Cuddy exit...

The mysteries surrounding Mike Cuddy, the Regions benefactors decision to step down from control yesterday, seem to be unravelling fast.

This in from the BBC:

Mike Cuddy says he quit as joint Ospreys managing director after "an injection of a seven-figure sum" into the region.

The region's financial problems and instability stopped Cuddy leaving the role at the end of the 2011-12 season.
In May the Welsh region faced a High Court winding-up petition over an outstanding tax debt and the case was dismissed in July.

"We've done some re-financing," said businessman Cuddy. "And we've had an injection of a seven-figure sum, which has put the Ospreys on a good financial position.


“I've had 10 wonderful years. I'm continuing to be a director… a shareholder… and as a sponsor. And that happened last Friday [28 September, 2012]."

Like the rest of the Welsh regions, the Ospreys are now operating under a self-imposed £3.5m salary cap. However, he admits that while attendances at the Liberty Stadium have shown an improvement this season, he warns that they are still not attracting sufficient numbers through the turnstiles.

"It's just Wales. They've [Ospreys gates] increased this year, but still not enough," said Cuddy.

Cuddy admits he would have preferred to leave his role after the Ospreys won the 2011-12 Pro12 title in dramatic fashion against Heineken Cup champions Leinster in Dublin. He added: "This [resigning] is something I've been thinking of doing for quite some time. "The end of last season would have been the best time to do it, but with the financial problems and instability that we had here at the Ospreys, I felt obliged to stay on and make sure that they were put to bed before I did this."

However, Cuddy will remain as a director and shareholder.

He added: "I've had 10 wonderful years. I'm continuing to be a director… a shareholder… and as a sponsor. "I'm not continuing as managing director, taking phone calls about buying five rugby balls and things like that every minute of every day."

Cuddy was instrumental in helping form the region in 2003 as Wales' old club system was revolutionised.
He brought Neath into a partnership with Swansea to form the Ospreys.

""It's just Wales. They've [Ospreys gates] increased this year, but still not enough," said Cuddy."

I will ask the obvious question, but I don't know how they will increase further when Ospreys have already drawn a lot extra in with their season ticket offers. How do they expect them to increase, when the likelihood is they will decrease at some point when the offer is withdrawn?

Risca Rev wrote:""It's just Wales. They've [Ospreys gates] increased this year, but still not enough," said Cuddy."

I will ask the obvious question, but I don't know how they will increase further when Ospreys have already drawn a lot extra in with their season ticket offers. How do they expect them to increase, when the likelihood is they will decrease at some point when the offer is withdrawn?

I didn't know the offer was to be withdrawn?

So you think it'll keep on going season after season? I can't imagine that being the case.

Good news on the investment though. Anybody know where it's come from?

Risca Rev wrote:So you think it'll keep on going season after season? I can't imagine that being the case.

Good news on the investment though. Anybody know where it's come from?

It would be ridiculous to not draw a conclusion on how to entice fans to the Liberty from this current offer. It has worked, figures are up. Not dramatically but they are up.

The side being successful and being able to compete well with the best in Europe would likely drag more fans again. Hopefully a combination of ticket/season ticket deals and good performance from the team would see more revenue from the turnstiles.

Biggest problem we have though is when not playing other Welsh Regions we rarely get any away fans visiting. I think that is similar for Ireland, Scotland and Italy.

Good news for the Welsh Region that has the potential to go all the way in Europe. They can certainly get bums on seats for some big Rabo games as we seen last season, and more noteably that competition is where their best performances on the field have been. To boost crowd figures they need to get the results in europe. I have no doubt at all that the fixtures against old rivals Leicester and french aristocrats Toulouse will each be bordering on sell-outs. Reward the spectators with the wins, more spectators will follow. Also, perhaps with this new seven figure budget they could bring in a big name signing that may attract the fans to the Liberty. Something along the lines of an ex-all black. All been done before but it is a new era now so time to reboot.

I'd just like to make it clear that it wasn't me who pumped a 7 figure sum into the Ospreys.

mikey

I was waiting for a deluded fool to start mentioning new signings and throwing money away on ex all blacks...

Truth is if the fans are not there week in week out now they are not going to be there for the Rabo games next season unless things change. The odd HC bumper crowd will help but not long term.

IMO rugby has been trying to follow the football structure of recent years, new out of town stadiums, surrounded by a hundred shops looking to cash in on the footfall, everyone making a fortune by rinsing the punter week in week out... UNSUCCESFULLY!!!

Wales is losing it's rugby soul to a generic model designed for sporting organisations to make as much money as possible, and until the focus comes back to rugby traditions, and becomes more localised we are not going to go anywhere.

Football fans can travel onto mainland europe in their thousands once every few months, Welsh rugby supporters cannot get on 16 flights per season to follow their team in the league alone, then add HC away games to that figure.

Rugby in south wales is dying, we need to smarten up quick.

Don't think a big name signing will help, after all the Ospreys have had plenty of big names in the past.

To be honest what Wales really really needs, is a team at least making the H-cup final. That feeling that the regions are among the best teams in Europe pulls in crowds.

Crowds flock to teams that they can be proud of, and the standard set for Pro 12 teams is being among the best in Europe, best in the league just doesn't do it currently.

thebluesmancometh wrote:Rugby in south wales is dying, we need to smarten up quick.

I've been saying that for years.

Then you've been wrong for years... big surprise.

The only way I can see >£1M investment is a sponsorship deal yet to be announced or one of the other directors or bank want's Cuddy out of running the club, no doubt we will find out soon enough.

Why would Cuddy have stepped down with a huge sponsorship deal though? And a 7 figure some wouldn't have come from a bank...

It wreaks of private investor... uh oh.

I would not want to see any "big name" signings rather more investment in what we have at the club and the academy.

For example if extra money was spent on better coaches for the Academy it would benefit Colleges and Clubs that support the Ospreys and therefor benefit the Ospreys.

Wales has done excellent work over the last decade in re-building the infrastructure that disintegrated during the 80's and 90's.

That is where our focus should be for the future, to build and to improve. We can not compete financially with France and England trying to buy our players, so we have to keep working hard to produce good players to replace those that leave.

thebluesmancometh wrote:Why would Cuddy have stepped down with a huge sponsorship deal though? And a 7 figure some wouldn't have come from a bank...

It wreaks of private investor... uh oh.

I think that there have been many people wanting Cuddy out for a number of years. Greatfull for all he's done but unsure of his designs for the future.

But again though nobody wouldve had the power to force him out if the investement was just sponsorship, if anything that wouldv'e rejuvinated his case for bein in control of the club.

IMO the Ospreys and Blues both needed shake ups since the foul business at inception.

thebluesmancometh wrote:But again though nobody wouldve had the power to force him out if the investement was just sponsorship, if anything that wouldv'e rejuvinated his case for bein in control of the club.

IMO the Ospreys and Blues both needed shake ups since the foul business at inception.

I agree.

I am very glad for this refreshing start minus Mr Cuddy to be honest. Things are looking good at the Ospreys, they have cut a lot of high expenses, Coaches were eating a lot of wages, players too. Now looking like a positive organisation with a decent future.

Definitely looking forward to finding out who, where and what this influx of cash is though...

MM

Shipping Holley to the BBC must have been such a relief too...

If I was you I'd be a touch worried though, if this is a private investor not from the region, or at least Wales it could mean a french league type of road ahead, a lot of money thrown around, influx of foreign NWQ players etc...

thebluesmancometh wrote:MM

Shipping Holley to the BBC must have been such a relief too...

If I was you I'd be a touch worried though, if this is a private investor not from the region, or at least Wales it could mean a french league type of road ahead, a lot of money thrown around, influx of foreign NWQ players etc...

Unlikely as it would be against the WRU's rules on the quantity of NWQ players. Should it be an investor, then they would have little influence on the clubs direction regarding signings of NWQs.

The WRU and the regions have all agreed on an accord to secure the sustainable direction of Welsh professional rugby. It seems like the way forward.

Have a read of the WRU rules on Player registration below.

WELSH RUGBY UNION LTD PLAYER REGISTRATION AND TRANSFER REGULATIONS
1. Player Registration:
(a) No player may represent a Club in any Fixture unless he is one of the registered playing members of that Club (‘Registered Player’), is on loan to that Club, is on dual registration with that Club or has been granted a permit to play for that Club. For the purpose of these Regulations “Fixture” shall mean any match forming part of a Competition, or a friendly match, sanctioned by the WRU.
(b) A Registered Player is one who has signed the Union Registration Form appropriate to his status and who has been duly registered with the Union in the Union’s Register in accordance with Regulation 3.
(c) A Club may register 2 overseas players who will at any one time be eligible to play in fixtures (i.e. if one or both overseas player(s) leave the Club he/ they may be replaced providing the number of overseas players does not exceed 2). In the case of a professional player from outside the EC and who does not have EC workers rights, a licence to employ the player must be obtained by the Club from the UK Border Agency. An application for a licence to employ a professional rugby player has to be supported by the Union. The Union will not support an application for a licence to employ a professional rugby player other than an application made by a Regional Team or a Premier Division Club. The numbers of overseas players which may be registered by Regional Teams is governed by the Participation Agreements between the WRU and the Regional Members.
An overseas player is one who is not qualified to play for Wales at the date of registration and who cannot prove to the satisfaction of the WRU that he is entitled to the rights granted under Title III of the EC Treaty or under the EEA or other European Agreement (i.e. a person who has European workers rights).
Any Premier Division Clubs registering more than 2 players who are not qualified to play for Wales will forfeit £15,000 from their WRU Distribution monies for every additional non Welsh qualified registered player in the Squad.
Only a player who is currently registered with a Union shall be able to participate in competitions organised, recognised or sanctioned by that Union (IRB Regulation 4.5.6)

I understand that, but not everything thats law is law if you know what I mean...

I am very curious to find out where this money has come from but am a little nervous too.

I thought the money was from re-financing. ie a re-negotiating of one of their loans (can't be morgage as they don't own the stadium) which would free up money and collatoral in the near future. This could be as Bluesman says to another investor, who used the re-negotiating as leverage to get Cuddy out and take a bigger part of the club himself.

Either way I imagine most of the money would go on clearing debts, marketing and put aside for the expected increases in the playing budget - increased wages/bonuses ect

SP that makes a lot of sense. Especially post PWC report.

BMC if it was a backer then it would likely be announced as so. Same if it were sponsorship.

Smirnoffpriest wrote:I thought the money was from re-financing. ie a re-negotiating of one of their loans (can't be morgage as they don't own the stadium) which would free up money and collatoral in the near future. This could be as Bluesman says to another investor, who used the re-negotiating as leverage to get Cuddy out and take a bigger part of the club himself.

Either way I imagine most of the money would go on clearing debts, marketing and put aside for the expected increases in the playing budget - increased wages/bonuses ect

I'm sure Smirnoff was going to do this anyway, but just to clarify, refinancing and renegotiating are different things, borrowing wise.

Cheers Cyril - yes of course I meant Re-Financing the debt, or re-negotiating the payment types.

Elementary mistake. thanks for pointing it out.

Why dont they play some games in other stadiums? Have the odd game back at st Helens

Coz they lose money I believe, as they'll already be paying for the Liberty and will have to pay for the new ground as well.

lostinwales wrote:Why dont they play some games in other stadiums? Have the odd game back at st Helens

They have played some games at the Brewery Field Bridgend and used to at the Gnoll. Now that cuddy has moved over I imagine we are more likely to make friends with Neath RFC again.

I would have thought this extra money will go into the running of the region, please for the love of GOD I hope they do not use the money to bring in expensive NWQ qualified players, by all means use it to keep their better players or even bring back players like Hook or Mike Phillips, but the Ospreys are on the brink of something special with local lads and a team ethos that are connecting with the fans, lets not spoil it lads.

South Wales Evening Post -

"The club is now on the soundest financial footing since its inception and the management team at the club now has every opportunity to move the Ospreys forward with the knowledge that the club is financially secure. I would like to offer my thanks to my good friends Kerry Bailey (PKF), Richard Price (New Century Finance), Martin Williams and Close Finance, for working with me to place the club in this position."

Cuddy will no longer be at the wheel on a day-to-day basis, his duties being assumed by Roger Blyth and Andrew Hore. But he underlined he wasn't departing the scene completely.

"Having concluded the deal, the next step was for me to stand down as joint MD, and step back from day-to-day involvement," he said.

"My commitment to the Ospreys cause has been total for nearly ten years and has often worked to the detriment of the many other things in my life.

"Of late, my workload has become an increasingly heavy one and I owe it to my family, my companies, and the hundreds of people who work for me, to adjust the balance of what I do and how I do it.

"But let me reiterate, I will continue to be heavily involved and am most certainly not walking away.

"The Ospreys is forever a part of me. I conceived it, birthed it and helped nurture it through its formative years; I mean, cut me in half and I'd have 'Ospreys' running around my inside like a stick of rock."

Confirming the deal that has secured the Ospreys future, chairman Geoff Atherton, said: "The Ospreys Rugby Club, and its parent company Llandarcy Park (Ospreys) Ltd, are pleased to confirm that they have concluded the successful completion of a refinance of the business.

"This refinance will put the organisation on a sound financial footing going forward and will allow the club to focus on furthering its on-field success.

"The Ospreys are extremely grateful to Mike Cuddy for effecting the introduction of our new lending partners and for his ongoing financial commitment to the club, along with that of all other directors and shareholders who have also maintained and furthered their investment within the club.

The Ospreys is forever a part of me. I conceived it, birthed it and helped nurture it through its formative years

OUCH!!

I wish someone would attempt to cut him in half to see if he does have Ospreys inside him... Byrne perhaps?!

LordDowlais wrote:I would have thought this extra money will go into the running of the region, please for the love of GOD I hope they do not use the money to bring in expensive NWQ qualified players, by all means use it to keep their better players or even bring back players like Hook or Mike Phillips, but the Ospreys are on the brink of something special with local lads and a team ethos that are connecting with the fans, lets not spoil it lads.

We were talking about this earlier, they can't bring in NWQs.

maestegmafia wrote:

LordDowlais wrote:I would have thought this extra money will go into the running of the region, please for the love of GOD I hope they do not use the money to bring in expensive NWQ qualified players, by all means use it to keep their better players or even bring back players like Hook or Mike Phillips, but the Ospreys are on the brink of something special with local lads and a team ethos that are connecting with the fans, lets not spoil it lads.

We were talking about this earlier, they can't bring in NWQs.

Well, both Mike Phillips and James Hook's tenures in France look to be coming to an end so perhaps we could see a return for both of them.

LordDowlais wrote:

maestegmafia wrote:

LordDowlais wrote:I would have thought this extra money will go into the running of the region, please for the love of GOD I hope they do not use the money to bring in expensive NWQ qualified players, by all means use it to keep their better players or even bring back players like Hook or Mike Phillips, but the Ospreys are on the brink of something special with local lads and a team ethos that are connecting with the fans, lets not spoil it lads.

We were talking about this earlier, they can't bring in NWQs.

Well, both Mike Phillips and James Hook's tenures in France look to be coming to an end so perhaps we could see a return for both of them.

True. We do have a wage cap in Wales of £3.5M. Can't see anything going on players to be honest. There are far more valuable things to spend the money on.

It looks to me as if Cuddy's Construction business needs a bit more of his time and cash, not suprising in the current ecconomic climate. I suspect the finance has been raised to allow the club to continue without Cuddy's support and possibly refund some of his investment to date.

I can't see the Ospreys bringing in any marquee signings as they are already over the £3.5m salary cap (an agreed situation due to the need to honour existing player contracts). They have a strong pack but I supose they could do with some creativity in midfield or a flyer out wide to convert their forward dominance into trys. A Hook, Henson (of 5 years ago) or a Tommy Bow would make all the difference.

Seagultaf wrote:It looks to me as if Cuddy's Construction business needs a bit more of his time and cash, not suprising in the current ecconomic climate. I suspect the finance has been raised to allow the club to continue without Cuddy's support and possibly refund some of his investment to date.

They must be confident of making something of the Ospreys as a business. Considering the amount that Cuddy has invested into the region he is walking out with a gold carriage clock and a bunch of shares.

I would be surprised if he is promised that the ospreys would "refund" any of his investment.