The Southern Kings announced on Tuesday that they will be immediately suspending their operations for the remainder of 2020, citing financial hardships compounded by Covid-19.
The Kings will therefore not take part in the planned domestic competition planned in South Africa which is scheduled to involve all of South Africa’s major franchises from Super Rugby and the Pro14.
The announcement was made in a statement released by South African Rugby on Tuesday morning.
"Following several weeks of interrogation of the Kings' financial state of affairs we were left with a straightforward choice," said Andre Rademan, chairman of the Southern Kings board.
"We could opt to field the Kings in the domestic competitions mooted by SA Rugby for the sport's post-lockdown resumption if we so wished.
"If we did so, it would require additional loans to the Kings or extra investment from the shareholders to the tune of R6.5m (Approx. €320,000), which would add to the organisation's existing substantial debt.
"However, as there was no contractual requirement for the Kings to resume short-term participation in the Guinness PRO14 competition, because of air travel restrictions, and as the Kings had no other commercial commitments to honour, the most prudent decision was to withdraw."
The decision was supported by the executive committee of the Eastern Province Rugby Union (EPRU) and SA Rugby – the two shareholders in the Kings company.
"This is obviously very disappointing news for the players and management who, like all rugby professionals, were desperate to resume playing,” said Rademan.
The Southern Kings joined Super Rugby in 2013, at the expense of the Emirates Lions, before being relegated from the 15-team tournament at the end of their first season.
They were reintroduced to an 18-team Super Rugby tournament in 2016, alongside the Jaguares and the Sunwolves, having been taken over by SA Rugby in 2015.
After being removed from Super Rugby yet again in 2017, the Kings joined the Cheetahs in a landmark move into the Guinness Pro14, where they have struggled to make much of an impact.
The Greatest Rugby Company in the Whole Wide World took over the majority share in the franchise in 2019, however the Kings have still suffered a major financial strain.
Rademan said that with ongoing uncertainty about competition formats and travel restrictions into 2021, the board would now take time to reconsider its options and the on-going financial challenges.
"As a board we had been considering further short-term contracts to see the squad through to the end of the year," he said.
"But it became apparent that we would, for want a better phrase, be throwing good money after bad in the current global environment.
"We now have time to consider what is the best way forward for rugby in the Eastern Province in this fluid and financially challenging environment."
Rademan, who is also president of the EPRU, said further consultation would take place with the Kings staff in the coming weeks over the next steps for the team.
SA Rugby assumed management control of the Southern Kings, having taken back a 74 per cent shareholding in the organisation, in partnership with the EPRU in June.
The move was made following the failure of the former majority shareholder (the Greatest Rugby Company in the Whole Wide World) to meet its financial commitments relating to the acquisition of the shareholding.
Download the brand new OffTheBall App in the Play Store & App Store right now! We've got you covered!
Subscribe to OffTheBall's YouTube channel for more videos, like us on Facebook or follow us on Twitter for the latest sporting news and content.
