In NRL clown town, can a Tiger turn into a Magpie? It’s not black and white...

You reckon perhaps it’s true; we’re all just existing in a clown world? Of course, why can’t a tiger shapeshift to transform into a magpie? The flying pests of the sky. Seems unremarkable enough. But in the clown town of rugby league, could a terror-inducing big cat morph into a dive-bombing scavenger?

Apparently, if that happens there’ll be 100,000 vociferous protesters, violently gyrating in the streets, David Bowie/Mick Jagger style. Which I’d dispute, personally. You’d be flat-out counting 100,000 people presently upright and breathing who would admit to being Wests Tigers fans.

Balmain, Western Suburbs and Wests Tigers fans at Leichhardt Oval.Credit: Getty Images

Indeed, it’d be surprising if an aggregate of 100,000 different people attended at least one Wests Tigers home match in Season 2024, regardless of how memorable it might’ve been.

Could the tiger actually be facing extinction? Stay with me, some of this gets fiddly …

Wests Tigers’ structure

The Australian Rugby League Commission Limited is the national sports organisation in Australia for rugby league and its wholly controlled entity, National Rugby League Limited, runs the premier National Rugby League competition.

Wests Tigers Rugby League Football Club Pty Limited – the Wests Tigers – is both (a) a voting member of the ARLC; and (b) a licensee of the NRL, holding a licence to participate in the NRL competition. Wests Tigers first participated in the NRL competition, under licence, in 2000.

Before then, there were the Balmain Tigers and the Western Suburbs Magpies. Each a foundation rugby league club and each with a storied history. It mustn’t be lost on anyone that the Balmain Tigers won the premiership 11 times between rugby league’s inception in 1908 and 1969; Wests have also won the competition, with their last premiership coming in 1952.

Wests Tigers’ membership of the ARLC and its licence agreement tethering it to the NRL are interdependent; if the licence agreement is severed, the membership of the ARLC ends, and vice versa.

Not all animals are created equal.Credit: Steven Siewert

The Wests Tigers have two shareholders: Balmain Tigers Rugby League Football Club Limited and Wests Magpies Pty Limited. But this is where things get slightly Orwellian – all animals are equal, blah blah – because the governance of Wests Tigers isn’t a flat democracy or anything approaching equality. Although Balmain hold 1,000,020 Class A ordinary shares, Wests Magpies hold 4,000,080 of the same class of shares.

This means that Wests Magpies own 80 per cent of the total share equity in the Wests Tigers. But it wasn’t always that way. Back in 1999 when the Magpies/Tigers forced marriage was first forged – with the Sword of Damocles dangling directly above the bride and groom– the union was an equal one at least.

But not any more. Sustained financial calamities throughout the last quarter-century have resulted in the re-jigging of “the prenup” – and the destruction of any semblance of balance – in what is now a husk of a “joint” venture.

The control of the Balmain and Wests Magpies shareholders is even more curious. Balmain’s governance is unremarkable in a sporting club sense; the company is in the control of its members.

Wests Magpies are fundamentally different, however; it has two shareholders: Western Suburbs Leagues Club Limited (Wests Leagues) and Western Suburbs District Rugby League Football Club Limited (Wests Football).

There are three shares on issue in Wests Magpies: an A Class share, a B Class share and a C Class share. Wests Leagues holds the A Class and B Class shares, Wests Football holds the C Class shares, but Wests Leagues exerts control over Wests Football in any event.

Wests Tigers are supposed to be governed by a nine-person board of directors. Balmain can appoint only two, Wests Magpies can appoint five, with two further “independent” people.

Tim Sheens and the Tigers celebrate their last grand final win in 2005.Credit: Craig Golding

Yes, I know, it’s muddier than the 1963 grand final.

Stopping at this point, one might assume the power all sits with the Wests Magpies. One might also assume that the Magpies, with their majority of directors, might happily knife the Tigers in a heartbeat.

What does this all mean?

In controlling four-fifths of the Wests Tigers shares, there must be a theoretical possibility that majority shareholders – the Wests Magpies – and their majority of nominee directors might harbour desires on reviving the Magpies at the expense of the Tigers.

But none of that will actually happen, for at least three reasons. First, that one of the two shareholders in Wests Tigers holds 80 per cent of the voting shares is merely one factor.

More important is what’s reserved for the unanimous approval of all shareholders. The function of the Wests Tigers as a business is to develop the game of rugby league and to enter teams in the NRL competition. Further, as history clearly demonstrates, the subject team in the NRL is known as “Wests Tigers”.

Wests Tigers’ shareholders have irrevocably, expressly and bindingly agreed between them that any decision to materially change the business, as conducted by the company, requires the unanimous approval of all shareholders, including Balmain.

The most fundamental aspect of the Wests Tigers as a business is the management and control of the NRL team, known as (and always having been known as) the Wests Tigers. Think about it for five seconds: the component of “the Tiger” is elemental.

Placed in absolute terms, Wests Magpies doesn’t have the necessary corporate power or ability to unilaterally junk the company’s NRL team’s mascot and livery, the team’s name and all else that goes with that. That would require Balmain’s willing co-operation, and that is extremely unlikely.

Second, the NRL’s licence to Wests Tigers isn’t a licence at large that allows Wests Tigers to do whatever they might decide depending on which way the wind’s blowing.

Who’s really pulling the strings at Wests Tigers?Credit: Wolter Peeters

Rather, the NRL’s licence permits the company to operate an NRL team branded as the “Wests Tigers”. There’s little in terms of argument that the licence should be amended and it would be a cool day in Lucifer’s dungeon before the NRL would acquiesce to such a change.

Third, any notion that changing the name and logo of the club would serve as a commercially prudent shift is difficult to justify. Frankly, it strikes me that any decision to make that change would be churlish and a bit idiotic, given the alienation it would cause among fans. Trashing a quarter of a century’s worth of brand equity on political lines does not seem a smart thing to do.

Indeed, it would be corporate idiocy, and any Wests Tigers director actually advocating for any such change isn’t properly discharging their director duties owed to the company, as distinct from being a mouthpiece for a shareholder.

So, where does all this come from?

The concept of being a member of a football club connotes having a democratic say in things. Conversely, that’s not really how the Wests Tigers structure works.

Wests Magpies have the power to appoint many more directors to Wests Tigers than Balmain. That imbalance accords with the shareholdings. But a different problem exists, in terms of how Wests Magpies makes its own decisions.

West Magpies is a registered club, which is governed by both the Corporations Act and the Registered Clubs Act. The latter legislation prescribes the types of members a registered club can have, and other rules about internal governance. Like most registered clubs, it has thousands of members.

But a curious “feature” (to use a neutral term) about how Wests Magpies is structured is that most of the power rests not with those thousands of members but instead with a maximum of 20 “debenture” holders, who’ve (apparently) lent the club $100 at an interest rate of six per cent, and in consideration enjoy entry to the inner cabal that effectively controls Wests Magpies in terms of director appointments.

In turn, it’s those 20 lenders of second-last resort who control four-fifths of the voting strength of the Wests Tigers and the NRL franchise itself. Democratic? You tell me. After all, finance is a gun; politics is just knowing when to pull the trigger.

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