Tigers facing administration unless £13m investment plan is backed
Leicester Tigers have warned that the club could be facing administration unless its shareholders vote through a plan by non-executive director Tom Scott and executive chairman Peter Tom to inject £13m into the club.
Tigers will take the plans to shareholders at a general meeting on March 3. The move would mean an initial £8.3m offer from Scott and Tom, with a further £4.7m promised. The deal would lead to Scott ending up with a majority shareholder in the club.
A letter from Tigers to shareholders reads: ““The Club is facing a deteriorating financial position which is expected to lead to a cash squeeze in the latter part of the first quarter of 2023 and therefore is urgently seeking further funding.”
“If the Resolutions are not passed, the board would have to find urgent alternative funding. Given the company’s current and anticipated working capital requirements, the directors believe that if the Resolutions are not passed they may have no choice but to appoint administrators to the company.”
The letter goes on to say that, if administrators are called into the club, then it would be expelled from The Premiership – Rugby Union’s top league. – which they won last season. It also warned that it could breach lending covenants in the first quarter of 2023 if the fresh capital injection is not secured.
Tigers made a loss of £1.9m in the 2021-22 financial year, on a turnover of £22m.
“Tom Scott is a long-standing supporter of the club and a valued member of the board of directors who over his tenure with the club has already invested over £10m,” Leicester Tigers’ CEO Andrea Pinchen said in a statement.
“Peter Tom has been chairman of Leicester Tigers since 1993, having made 130 appearances for the club between 1963 and 1968 and has been a huge part in navigating the club through the professional era.
“We are very grateful that Peter and Tom are looking to extend their investments in Leicester Tigers at a time when the club is suffering some very challenging conditions from factors mostly outside of our control.
“Their decision to invest at this time will give the club the financial assurance to execute the club’s strategy of continued success and financial sustainability.”
