Otago Rugby has "50/50 chance"

The debt-ridden Otago Rugby Football Union has been given yet another reprieve from liquidation.

What may have helped tip the scales in the union's favour today is an unconfirmed report that the Dunedin City Council is considering writing off $400,000 in debt owed in rent for use of the old Carisbrook rugby ground. The loss of a key tenant for the new $203 million Forsyth Barr Stadium would be a major blow for the council.

The union's board has announced that it will hold off filing an application to liquidate the organisation until next Friday March 16.

ORFU chairman Wayne Graham told media the union now has a "50/50" chance of survival.

NZRU chief executive Steve Tew was more circumspect, saying only he "would not have prolonged the agony" unless there was hope of reaching a recovery plan.

A deadline had been set for 4pm today but the union says it wants more time to find a solution to its $2.35 million debt burden and a loss this year projected at $750,000.

It owes local creditors almost $700,000 and the Bank of New Zealand $1.2 million.

The NZRU said in a statement today that it had spent the past week working through the details of a recovery package with the Dunedin City Council, Dunedin Venues Management, the New Zealand Rugby Players Association and the Bank of New Zealand.

NZRU Chief Executive Steve Tew said discussions had been fruitful and "we are certainly more hopeful than two weeks ago so that is good progress."

"As we said last week the options we are looking at are very complicated, there are many moving parts and all have to come together to ensure we have a viable plan. The extra week will give all parties the time they need to make final decisions."

"While it is not appropriate to discuss the shape of any plan, what we have said all along is that any deal must be very clear on a number of counts. It must put the union on a sustainable long term financial footing and must put in place appropriate governance arrangements to ensure the mistakes of the past are not repeated."

Tew's reference to "appropriate governance arrangements" echoes concerns raised in NBR Online earlier today by business commentator Julian Smith who slammed the union's board for some bad business decisions in recent years.