Munster may sell Thomond naming rights to ease debt crisis

Munster Rugby are preparing to revisit the thorny subject of selling thenaming rights to their iconic Thomond Park as one measure to address their current financial concerns.

The branch reported a projected deficit of €1.052 million for the year ending June 30, 2012, to delegates at their Annual General Meeting in Cork on Tuesday night.

Munster’s financial controller Philip Quinn also forecast a considerable reduction in that figure to €185,000 in his projections for 2012-13 withongoing cost reduction initiatives with a view to breaking even a year later.

Quinn told the meeting that a branch sub-committee had been formed to assess cost-cutting but warned that a break-even budget in two years was essential to Munster’sfinancial survival.

“Anything more and we won’t be able to pay our bills in 2013-14,” Quinn told delegates.

One way out of the economic straitjacket is naming rights, an avenue that has been on the Munster road map since Thomond Park underwent a €40m redevelopment in 2007-08 but the route has been declined, considered sacrosanct by delegates and fans alike.

On Tuesday there was a distinct sign of shifting priorities when a delegate raised the issue as a possible way out of trouble.

“Very much so,” replied Quinn. “Thomond Park is half-owned by the IRFU and half by Munster and run by the stadium directors, three of whom are appointed by the branch and three by the IRFU.

“It’s one of the top items on the agenda. Whether its the whole stadium or individual stands named or something else, it’s open for review.

“As a finance person I would love for somebody to come in and be able to do it but whether it’s feasible in the current climate... we have made contact with various parties.”

Also significant at the Munster AGM was the adoption of new bye-laws which in addition to replacing the existing co-ordinating committee with a management committee to fall in line with the other provinces, formalised an independently-chaired commercial board with a view to attracting further investment.

One of the biggest drains on Munster’s income is the annual repayment of €400,000, plus interest, to the IRFU for their loan to finance the stadium redevelopment. The branch was hit by a higher than expected hike in interest rates, being forced to pay 3.25% rather than the budgeted for 2.75%.

This year’s repayment would be drawn from the remaining Munster reserves the AGM was told, and, responding to a question from the floor, finance and administration committee chairman Declan Madden said the IRFU were not prepared to renegotiate the terms of the loan.

“We’ve spoken to the Union and at the moment... €400,000 is probably a good deal, plus interest of about maybe €300,000,” Madden said.

“It’s a bit like Ireland asking to pay back the money [to the Troika] over 10 years. As it is we’re effectively outside the terms of our loan. We’re not in default but we have forbearance from the Union in regard to it. So we’re going down the road of clearing the outstanding balance of €10.2m and we’ll be meeting with the Union in July and it will certainly be on the agenda then.”