Sharks for sale
Jacquelin Magnay | May 8, 2009
CRONULLA-SUTHERLAND chief executive Tony Zappia has proclaimed the Sharks are now "for sale" and he will be seeking cashed-up equity partners in the club following a swift rejection of plans to relocate five home games to the Central Coast.
Zappia said he was extremely disappointed at the decision of the NRL's partnership executive, which yesterday afternoon decided not to support an $800,000 part-relocation idea at this stage.
"I am very disappointed, but it was an opportunity that we needed to look at, and not getting approval is a hurdle we need to overcome," Zappia said.
Plan B for the Sharks is to seek financial backers prepared to buy a stake in the club, which is potentially asset rich - with undeveloped land beside the leagues club - but cash poor.
Last year, the Sharks lost $1.4 million, turned $6 million in the bank into a $2 million overdraft and have more than $12 million of short-term debt that has still to be refinanced.
Zappia is looking for some guaranteed income to satisfy the bankers that the football club and leagues club entities can operate as a going concern. Long term, the club is looking to develop the land with a $110 million proposal before Sutherland Council.
"We have to be proactive, it is tough, but I want to see if there is anyone out there who wants equity in the Sharks, I will be knocking on everyone's door," Zappia said.
"The Sharks board hasn't canvassed it, but it is part of my responsibility to look at whatever is out there."
When asked how much he thought the club was worth, he replied : "I don't know, I have to sit down and think about it."
Zappia said in order to generate more immediate cash flow he may look to play more games in Adelaide - where the South Australian government has been offering financial incentives - and removing the Sharks' home-ground advantage when they are due to play the Brisbane Broncos in late June, relocating the match from Toyota Stadium to Suncorp Stadium.
"Adelaide is a possibility, or playing Brisbane in Brisbane, not at Toyota, might be something, they get reasonable crowds up there, much more than we do," Zappia said.
Zappia might look at the history books of the Sharks before knocking on too many doors. Back in 1986 the flamboyant doctor Geoffrey Edelsten presented his wife Leanne with her second wedding anniversary gift - the Cronulla-Sutherland rugby league team - draped in her favourite colour of pink at a Sydney hotel.
Her immediate comment? "They're a good-looking bunch of boys."
However, the deal for private ownership fell through.
NRL chief executive David Gallop said the code was not prepared to put money into Cronulla's Central Coast plan because it wasn't justified for such a short-term, ad hoc approach.
The partnership executive felt that the money wouldn't necessarily solve the Sharks' financial woes either.
However, it is understood the NRL is sympathetic to the Sharks' plight and are willing to look at various other measures to help them trade out of trouble.
Under the current broadcast deal the NRL is contractually obliged to provide eight games a week.
"The partnership executive committee has only had the opportunity to look at Cronulla's proposal on a preliminary basis, but it appeared that it was neither one thing or the other, it doesn't solve Cronulla's issues nor did it give the game what it was looking for, which was a fully-fledged team on the Central Coast," Gallop said.
"We will work with Cronulla and see where they are at and their options, but we don't see any value in pursuing the Central Coast."
Gallop said the Bulldogs had previously switched home games to south-east Queensland because of the more lucrative gate receipts and a proposal to do the same for the Sharks' clash with the Broncos would be considered favourably.
As for a partial or full sale of the club? "The NRL would not discourage that," Gallop said.
It is understood that the Sharks' main creditor, St George Bank, has put together a deal to refinance the club's short-term debt, but the terms of such a proposal, including the interest rate, are unclear at this point.
