Knights new era: Wests, NRL finalise deal

CONFIDENT: Chief executive Phil Gardner believes the Wests Group can help the Knights become a thriving NRL franchise.THE salvation of the Newcastle Knights lies in the hands of 120,000 Wests Group members.
Nanjing Night Net

A deal for Wests to take ownership of Newcastle’s embattled rugby league flagship has been agreed in principlebyNRL officials and the Wests’board of directors.

But Wests will not proceed unless their proposal receives endorsement from their members, who will be asked to vote at any of the group’s six licensed premises between July 31 and August 6.

It will not be a formal ballot, because Wests’ board has the constitutional authority to proceed with such a move without consulting the membership. But without a clear mandate, the takeover will not proceed.

If members approve, Wests would join forces with the NRLon August 15 for atransition period beforea full handover on November 1.

Wests would then own the Knights 100 per cent, in perpetuity, without having to pay a licence fee or any of the liabilities –estimated to be at least $5 million – accrued since the former owner Nathan Tinkler’s demise in 2014.

A new Knights board would be created, separate from the Wests board.

It is understood Wests would incur operational costs from August 15 onwards, but their main outlay will be $10 million towards a proposed rugby league centre of excellence at Broadmeadow.

Heading towards their third wooden spoon in as many seasons, the Knights are arguably at their lowest ebb.

But Wests Group chief executive Phil Gardner believes that, with prudent governanceand community support,Newcastle’s NRL franchise can be successfully reinvented.

“We hope our members will see that Wests cares, and we are doing this for the benefit of the community and the city, and they will come with us,’’ Gardner told the Newcastle Herald.

“If they say ‘no’, then the decision for us is really simple. We would understand that and accept their wishes.”

Asked what would happen if members voted overwhelmingly against the proposed takeover, Gardner replied: “Well, the NRL would keep it [the Knights] and it would be their call what happens in future.

“But we wouldn’t be putting this proposition to our members if we didn’t think there were real concerns about the Knights’ future.

“If Wests aren’t involved in the Knights next year, and the NRL are left to run it, there’ll be no money going into the club. The NRLdon’t have it.

“They wouldn’t spend the salary cap, they’d cut all the other expenses, and they’d be running a ‘shell’ of a football team until they either found an owner, or moved the franchise.

“The club can’t take too much more of what has happened over the last three years. It’s facing death by1000 cuts.I see that as a real outcome.

“That’s basically what we’re saying to members.

“If we don’t do something now, the Knights could be unsaveable.’’

Gardner believes that, with annual funding from the NRL to each club increasing from $7.6 million to $13 million on November 1, Wests could have the Knights running as a break-even operation within five years.

But he acknowledged the venture was not without risk.

“It’s a gamble and risk that we want the members to support us in,’’ he said.

“We’ve done our due diligence on the team, the finances and the game. The risks are enormous …butwe think those risks are manageable.”

Gardner said there would be no financial impact on members. If the proposal was rejected, Wests –which made a profit of more than $23million last year – would contribute the funds to other community projects.

NRL CEO Todd Greenberg describedthe agreement as “a great outcome” for the Knights, the Newcastle community and the game.

“We always said future ownership needed to be good for the club, the community and the game and we’ve secured that outcome through this agreement with Wests,” Greenberg said.

“When the NRL took over the Knights in 2014, we needed to secure the financial future of the club and then deliver the best possible future ownership to run the club into the future.

“Those goals have been achieved and there is now every opportunity for the Knights to become a powerhouse of the game in the years ahead.

“Wests are ideal owners of the Knights given their strong rugby league heritage and their strength in the local community.”

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