Otago RFU prepares for brighter future

- New board and chairman appointed
- Creditors to be paid by end of May
- Sport Otago to provide interim General Manager

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The Otago Rugby Football Union has opened a fresh chapter in its history with the appointment of a new board and the union's recovery package going unconditional today.

"The stage is now set for the Union to face the future with confidence," said New Zealand Rugby Union (NZRU) Chief Executive Steve Tew.

"We thank all our partners who have worked hard over the last few months to ensure this 131 year old rugby institution can survive and play its part in the Otago community."

New board and financial plan

A new six member board has been appointed under the terms of the recovery package agreed in March between the NZRU, the Dunedin City Council, Dunedin Venues Management Ltd (DVML), BNZ and the New Zealand Rugby Players Association (NZRPA).

The members are Doug Harvie (Chairman), Keith Cooper (Deputy Chairman), Kelvin Collins and Simon Spark. In addition, two existing directors John Faulks and Andrew Rooney who have been board members since 2010 have been appointed for one year terms.

"The six directors were the strongest candidates we could select. They have excellent commercial and governance skills as well as rugby administration experience so we are confident the new board can take the organisation forward," said Tew. "The two existing directors will also provide important continuity in the months ahead as the new board and management bed in."

New Chairman Doug Harvie said it was an honour to lead the union into a new era.

"Rugby plays an important part in the lives of so many throughout the region and we are excited about the role we will play in rebuilding this proud organisation."

The recovery package involved the NZRU providing a long term loan for working capital of $500,000 and Dunedin City Council (DCC) writing off debt of $480,000. In addition, costs have been cut and additional sponsorship arranged.

Doug Harvie said a reworked financial plan shows the union forecasting a modest surplus for this financial year and remaining in black in 2013 and 2014.

"There is no doubt we have turned the corner and we thank the NZRU, the Council, Dunedin Venues Management Ltd, BNZ and the Rugby Players Association for providing the platform that will allow us to build for the future.

"We are especially grateful for the continuing support we have received from existing sponsors Speights, Silver Fern Farms, Canterbury Clothing and TicketDirect. They have stuck with us through tough times and we are determined to reward them for their loyalty," he said.

Creditor repayment plan

"The other good news is that we have managed to secure a settlement with creditors which we hope will help us rebuild the goodwill with the Otago business community whose support is vital to helping us deliver rugby at all levels."

Almost $500,000 has been raised to allow the union to settle with creditors. A total of 156 non-profit organisations and other creditors who are all owed less than $5,000 will be paid in full.

The remaining 24 creditors will be repaid the first $5,000 and half of what they are owed above that. The repayments are due to be made by the end of the month.

"The response from people and businesses from around the country to the fund raising drive has been humbling," said Harvey. "So many have put their hands in their pockets at a time when wallets are already stretched.

"We thank Campbell Live for driving the fund raising effort on its show, the support of Speights and Restaurant Brands and also Sir Eion Edgar, Laurie Mains and John Faulks for their generous contributions to the settlement plan.

"I would also like to thank the outgoing board for the work they have done in recent months to get us to this position today given how difficult it has been for them over that time."

Interim manager appointed

The new board will appoint a permanent general manager in coming months. In the meantime Sport Otago has agreed to second Programme Director Richard Kinley to the role. He will shortly replace Change Manager Jeremy Curragh, who was appointed by the ORFU in January.

"We are happy to help the union out in this regard, given the important role rugby plays in our province," said Sport Otago CEO John Brimble. "The community has rallied around to support Otago so it's great to do our bit to help the union get back on its feet."

Background notes

ORFU board members

Doug Harvie (Chairman) - three year term
• Chartered accountant, arbitrator and mediator
• Managing partner Harvie Green Wyatt
• Played for Dunedin and University rugby clubs
• Former committee member Dunedin Rugby Football Club
• Current member DRFC and Otago Sassenachs

Keith Cooper (Deputy Chairman) - three year term
• Chief executive of Silver Fern Farms, Dunedin-based farmers co-operative responsible for processing and exporting 30 per cent of NZ's meat production
• Professional life spent in meat industry, with experience in sales and marketing, general management, merger and acquisitions and restructuring

Kelvin Collins - two year term
• Managing Director of Harcourts Highland Real Estate Group
• Director and shareholder of Haast World Heritage Hotel
• Extensive rugby playing, coaching and administrative experience, having represented Nelson Bays and Otago Country seniors, Canterbury Colts and U20, coached Wakitipu premier team and chaired Sevens with Altitude

Simon Spark - two year term
• Managing Director of SJ Allen Wakatipu 2000 Ltd
• Coached rugby to representative level, involved in rugby administration and young player identification and development, working with ORFU and Otago Country
• Involved in athletics administration in Southland
• Experienced in securing funding for community organisations, including the development of a multi-use facility in Arrowtown

John Faulks - one year term
• Director and manager of Southern Wide Real Estate
• Chairman Rural Livestock Ltd, second biggest livestock broking company in South Island
• Director Foley Plumbing and Lilyfarm Properties
• Actively involved in rugby administration, played and coached at all levels of the game

Andrew Rooney - one year term
• Investment advisor with professional experience in engineering, management and the financial services industry
• Manager of and player for Dunedin Rugby Football Club senior team
• Involved in rugby administration with DRFC and Metropolitan Rugby Council
• Member Institute of Directors

Key elements of ORFU recovery package

• Achievable three year financial plan to ensure ongoing financial viability. This comprises:
o Reduced operational expenses including ongoing player payments
o Additional sponsorship pledges
o Test match management income

• NZRU provides a $500,000 loan for working capital
• NZRU confirms All Blacks Tests in Dunedin in 2013 and in 2014 in addition to this year's Investec Rugby Championship Test against South Africa
• DCC and DVML forgive debt of $480,000
• North v South match in June. DVML receives all revenue and covers all costs
• DVML secures a three year venue hire agreement with ORFU for the ITM Cup team
• DVML agrees to manage the commercial and sponsorship rights of ORFU
• NZRU will enter into an additional sponsorship commitment with Bank of New Zealand
• The NZRU loan subject to the following main conditions:
o ORFU board to resign. New constitution to ensure best practice governance
o NZRU to approve all player contracts
o Annual budgets and loan information to be provided to NZRU
o NZRU observer or representative to be at all board meetings