Wasps: Bondholders asked for more money to prevent stadium businesses from going out of business

Bondholders owed £35m by Wasps have asked for more cash as the Coventry Building Society Arena business is threatened with liquidation.

Wasps Holdings is the parent company has already entered the administration – with debts amounting to nine figures.

This led to all players and coaching staff of the rugby club are released from their contracts were appointed administrators of the FRP on October 17.

But the companies that make up the stadium business – Arena Coventry Limited and Arena Coventry (2006) – are not yet in administration and continue to operate, with Championship football club Coventry City continuing to play their home games at the CBS Arena.

The letter to bondholders said: “In the absence of additional financing in the short term, it may not be possible to continue marketing the assets that are part of the security.

“In that event, the statutory purpose of the administration may not be achieved and the directors of Arena Coventry Limited and/or Arena Coventry (2006) Limited may have no choice but to apply to the court for an order placing ACL and/or ACL2006 into compulsory liquidation “.

The letter also said that any additional financing would not take priority over existing bondholder debt that was originally due in May. Another interest payment of around £1m is also due next month.

The stadium companies have until Monday to secure funding or a new buyer for the stadium or they too could enter administration.

But the insolvency court can apply for another extension to that deadline if they can show new financing or a takeover deal is close to being agreed.