The South African franchise of the Southern Kings has been placed in liquidation due to a cumulative debt of 55 million rand (2.84 million euros), the South African Federation (SARU) announced on Saturday.
Like the Cheetahs, the other South African province engaged in Pro 14 since 2017, the Southern Kings were unable to resume the season of the former Celtic League due to health and logistical constraints imposed by the Covid pandemic. 19, which hit South Africa hard.
"The shareholders - the Eastern Cape Provincial Federation (EPRU) and SA Rugby - made this decision in the face of a cumulative deficit of R55 million, and with no income in sight for the remainder of 2020," said SA Rugby in a press release.
"The harsh reality is that the Kings are insolvent, with significant debt and zero assets and it would have been unwise to continue the business," said Andre Rademan, chairman of the board.
"To continue would have required loans from the EPRU and loans in addition to the 45 million rand (2.33 million euros) the company already owes to SA Rugby," added Rademan, who has no visibility for 2021.
Mark Alexander, president of SA Rugby, said it was time to "reconsider" a "suitable and viable" rugby project for the Eastern Cape.
At the end of June, SARU had taken control of the Southern Kings, facing serious financial difficulties: for the second time in five years, the body had thus saved the franchise from bankruptcy by recovering 74% of the club's shares after a default payment of its majority shareholder.
Stopped in March due to the pandemic, the Pro 14 resumed in August in a tightened form, reduced to transnational meetings to limit border movements.
And without the Southern Kings and Cheetahs, who were only allowed to resume training at the end of July.
Isolated by the pandemic, SA Rugby announced on Friday the creation of a national version of Super Rugby, thus following in the footsteps of New Zealand and Australia.
Seven franchises will resume competition in October, after more than six months without playing.
© 2020 AFP