NRL chief executive Dave Smith insisted the Newcastle Knights were in a secure financial position and vowed to strengthen its community involvement after the governing body took control of the embattled club on Saturday.
Eleven weeks after Fairfax Media exclusively revealed Nathan Tinkler's reign was in jeopardy because of his failure to extend a $10.52 million bank guarantee, the process of removing Hunter Sports Group from control has been finalised.
The agreement was reached after extensive negotiations between the former owners and the Knights Members Club, which will hold a 20 per cent minority interest under the new structure, and the NRL.
The club's assets have been transferred to new entity Knights Rugby League Pty Ltd.
Matthew Gidley (CEO) and Paul Harragon (chairman) will continue their roles and will be supported by an NRL management team.
The future of coach Wayne Bennett is secure at least until new shareholders are brought in.
HSG, headed by Troy Palmer, will have no further input to the club.
‘‘The Knights will continue to be Newcastle through and through,” Smith said at a press conference at Hunter Stadium on Saturday.
“The team will look the same, they will continue to be based in Newcastle and they will represent this region proudly like they have for the last 26 years.
‘‘It’s about Newcastle, it is about the community of Newcastle, and we are going to make that community connection stronger not weaker.
“The difference is that, financially, they will be one of the top tier clubs in the competition.”
After Tinkler couldn’t renew the bank guarantee, the Knights Members Club accessed the $10.52m from last year.
Half of that ‘‘nest egg’’ has been used to pay HSG’s existing staff and supplier debts, leaving $5.1m to capitalise the club.
‘‘The uncertainty is gone,’’ Smith said.
‘‘We have secured the long-term future for the Newcastle Knights.
‘‘The balance sheet and the structural position of the Knights could not be stronger.’’
Smith said negotiations had been ‘‘very complex’’ but they had ended up in the ‘‘best place for the Newcastle Knights’’.
A new board will be formed, comprising one community representative nominated by the Members Club, two shareholder representatives initially from the NRL, and four independent directors.
‘‘The NRL, as the governing body, doesn’t want to run football clubs, but where necessary, where it is the appropriate thing to do to protect the long-term future of a great club like the Newcastle Knights, we will clearly step in.
‘‘The next step will be to stabilise the club, we are not in a hurry, it is a very well capitalised club, then to think about the ownership structure of the club.
‘‘I cannot reiterate enough, though, that this is about Newcastle, the people of Newcastle and the proud history of this club.
‘‘There will always be a community representative on this board. It is part and parcel of the board.
‘‘What we hope is that the board is completely populated by directors from the Hunter.
‘‘That is going to be subject to people wanting to come on the board with the right skills.
‘‘It will be a Newcastle/Hunter board designed to take the club forward.
‘‘I hope the shareholder of the future is Newcastle/Hunter based.’’
The NRL has been in discussion with Wests League about their potential to become shareholders.
‘‘We want to bring in a new ownership structure with the right owners, who want a working partnership and have the same objectives as us,’’ he said.
‘‘Obviously we will be very happy to continue talking with Wests.’’
Members Club director Allan McKeown said other options were considered but the final choice was aimed at securing the club's future.
“While there were a range of options available to the Members Club, we wanted to end the uncertainty surrounding the Knights and give the players, staff, fans and members a strong future,” he said.
Gidley said the agreement was a chance for a ‘‘fresh, strong start’’.
Smith paid tribute to the Members Club for their diligence and co-operation.
‘‘They have done a terrific job,’’ Smith said.
‘‘They have negotiated in good faith so that we get the right outcome in the best interests of the club.’’
‘‘I take my hat off to everybody who has been involved in these talks.’’
Palmer said the company was proud of its legacy at the Knights.
“We have invested more than $20 million and the Knights now have a stable building platform which is reflected in the world-class training and coaching structure from the NRL down through the elite junior programs.’’