Wasps bondholders owed £35m asked for more cash to avoid stadium business liquidation

Bondholders owed £35m by Wasps have been asked for more money in a bid to avoid the potential liquidation of the Coventry Building Society Arena stadium business.

A letter from bondholder trustee, US Bank Trustees Limited, to bondholders said the funding was needed to continue to market the stadium to potential investors or new owners.

Parent company Wasps Holdings has already entered administration which saw all the players and coaching staff at the rugby club being released from their contracts.

But the companies which make up the stadium business – Arena Coventry Limited and Arena Coventry (2006) – are not yet in administration and continue to operate.

The letter to bondholders, seen by the BBC, read: “In the absence of receipt of additional funding in short order, it may not be possible to continue marketing the assets which form part of the security.

“In such event, the statutory purpose of administration may not be capable of being achieved and the directors of Arena Coventry Limited and/or Arena Coventry (2006) Limited may have no choice other than to apply to court for an order placing ACL and/or ACL2006 into compulsory liquidation.”

The stadium companies have until Monday to secure funding, or a new buyer, for the stadium or they too could enter administration.

Bondholders are owed £35m after Wasps Group launched a plan in 2014 to purchase Coventry Building Society Arena, then called the Ricoh Arena, with money raised through a first-of-its-kind bond scheme.

Costing £2,000 each, the bonds offered 6.5% interest every six months over their seven year period. The cash enabled Wasps Group to secure the arena from operating company ACL – jointly owned by the Alan Edward Higgs Charity and Coventry City Council.