Collapse of Rebels sparks legal battle, puts MCG World Cup final in doubt

Extreme doubt now surrounds Victoria’s chances of hosting the 2027 World Cup final and other major rugby events after Rugby Australia shut down the Melbourne Rebels after 14 seasons, sparking a court battle with the consortium that planned to save the club.

The Rebels will play their last game next month after Rugby Australia chief executive Phil Waugh told Rebels staff and players of the impending closure at a 10am meeting on Thursday at AAMI Park.

The Melbourne Rebels will play their last game next month.Credit: Getty Images

The club was shut down after RA chose not to support a rescue plan proposed by a consortium led by business heavyweight Leigh Clifford, a former chairman of Qantas and chief executive of Rio Tinto. Waugh told Clifford of the decision on Thursday morning.

The club has been in administration since January with debts owed to creditors exceeding $23 million, including an $11.5 million debt to the Tax Office.

The decision was met with criticism, and Clifford announced the consortium would launch legal action against the peak rugby body.

State Sports Minister Steve Dimopoulos questioned whether Victoria would continue to host rugby events.

“The Victorian government is extremely disappointed that Rugby Australia has decided not to support the Melbourne Rebels following the team’s 2024 season, after we made it clear that we expected them to commit to a team at the elite level of the sport in Victoria,” Dimopoulos said.

Fronting the media on Thursday, Waugh and RA chairman Daniel Herbert described it as a difficult day for fans, players and staff, but said they had given the consortium every opportunity to present a viable case.

Waugh and Herbert insisted the collapse of the Rebels would not impact rugby in Victoria.

Herbert said that while the state government had outlined its support for the Rebels to continue, “at no time did they offer to underwrite or to contribute a larger amount of money to the Rebels”.

Asked whether Victoria was still a contender to host the 2027 Rugby World Cup final, Waugh said: “We’re very committed to working with Visit Victoria [and] the Victorian government; international rugby has been very successful in Australia for a long, long time. And we’re confident it will continue to be that way.”

A decision on the women’s team will be made a later date, but both men outlined their interest in maintaining a team in Melbourne.

Legal battle looms

Herbert was scathing of the consortium’s rescue plan, describing it as “embryonic” and “very underdeveloped”.

Rugby Australia’s key issues with the Rebels consortium rescue deal

• A reliance on extra funding from the governing body “to cover forecast operating losses” and “overly optimistic” financial projections.
• Identities of consortium members were not disclosed.
• That key advisers included at least one current or former director of the Rebels – “meaning that an individual or individuals involved were responsible for the [club] governance during the period in which the administrator considers the company may have traded while insolvent”.
• Verbal assurance but no documentation to support the claim that the consortium has committed $18 million in funding.
• No official agreement with Western Melbourne Group regarding co-location at Tarneit.

Among Rugby Australia’s concerns with the deal, Herbert said, was that the consortium would not name the people involved, and would not provide documentation for the $18 million it claimed to have raised.

“It’s not at a point that any reasonable governing body can issue a licence based on the information we were provided,” he said.

Herbert confirmed the sport would counter-sue the former Rebels directors if they chose to move ahead with legal action.

“Every dollar spent on lawyers is money not spent on rugby and community games and programs, and other Super Rugby clubs. It is not our preference,” he said. “There’s only so many times you can continue to be threatened without pushing back.”

Asked what the claims against the directors were, Herbert said: “That they were continuing to take money whilst they were allegedly trading insolvent.”

Waugh confirmed that another claim was related to an earlier accusation that directors had misused tax funds forwarded by the national body, but declined to detail the other claims.

“We’re not interested in taking much-needed money out of the game to pay people’s personal debts,” Herbert added, referring to the $11.7 million tax debt the seven former Rebels directors are liable for.

Rebels general manager of rugby Nick Stiles at AAMI Park on Thursday.Credit: Simon Schluter

‘Lack of transparency’ in rescue plan

As a result of the Rebels’ administration, RA assumed all payments for the players’ wages and funded the club for the 2024 season. It also stripped the club of its right-to-play licence.

The news of the club’s shutdown came just hours before the Rebels players were due to fly out to Fiji for their last regular-season game on Saturday, and ahead of the club’s first finals appearance the following week. Players were en route to the airport after the Thursday morning meeting.

At that meeting, the players deliberated whether to catch their flight to Fiji, but decided to go ahead – they wanted to finish as the greatest Rebels team.

Leigh Clifford says the Rebels will take Rugby Australia to court.Credit: Eddie Jim

The consortium’s plan to fund the club until 2030 was dependent, in part, on Rugby Australia handing back the licence.

Clifford described the Rebels’ shutdown as a “slap in the face” for sport-loving Victorians. He said the group would move to sue RA.

“The Melbourne Rebels never want to go to court, but Rugby Australia’s actions to turn their backs and not negotiate on a commonsense $18 million rescue plan has left the club no choice,” he said.

“Rugby Australia is shrinking the sport, [has] abandoned any pretence they are a serious national competition and cut off the pathways for girls, women, boys and men to live their dream of playing professional rugby for their local team.

“The fact that Rugby Australia recently chose to provide millions of dollars in financial support to the NSW Waratahs and provide not a cent to the Rebels says everything Victorians need to know about their priorities.”

Players to negotiate new homes

After “scenario planning” discussions with RA and the Rugby Union Players’ Association in recent weeks about their futures, Rebels players will now enter into contract negotiations with head office and other Super Rugby franchises about moving to a new club.

No players can be forced to move elsewhere by RA. Players who were contracted to the Rebels through to the end of 2025 have the option of leaving Australia and playing overseas, given their original contract is void.

The general manager of rugby at the Rebels, Nick Stiles, said the players were devastated on learning of the club’s closure.

“Obviously, everything’s very raw for us at the moment,” he said.

“The community down here in Victoria is a passionate rugby community. We’ve provided multiple players coming through the pathway now into the Australian Wallabies and Wallaroos as well and to think now that’s going to be jeopardised is something that cuts us all greatly.”

Stiles said he did not yet know about his own future or that of coaching staff.

The Rebels were born in 2010 when Super Rugby was expanded to 15 teams, and from seven Australian bidders a Victorian team was chosen by Rugby Australia.

Before this year, the highest place finish for the Rebels was ninth in 2018, and financial struggles were also a constant feature off the field.

With Kieran Rooney

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