Rugby Australia on Thursday rejected a consortium's bid to take over the debt-laden Melbourne Rebels and shut down the club after 14 seasons in Super Rugby.
The team went into voluntary administration in January owing almost Aus$23 million (US$15 million) – a large portion of it tax debt.
Rugby Australia stepped in to reclaim the club's playing licence while paying staff wages for the 2024 season, before a consortium led by former Qantas chairman Leigh Clifford put forward a rescue plan.
But it was contingent on Rugby Australia handing back the licence, which they have opted not to do, saying the bid "did not demonstrate sufficient financial viability" with "significant doubts" over the funding model.
💔💙 pic.twitter.com/U8ioG7U275
— Melbourne Rebels (@MelbourneRebels) May 30, 2024
"Since the Rebels' inaugural year in 2011, MRRU (Melbourne Rebels Rugby Union Pty Ltd) has not been independently financially sustainable despite significant additional investment by RA over and above committed club grants," Rugby Australia said in a statement.
"There is nothing in the consortium's proposal which demonstrates with sufficient certainty that this will change."
The Rebels, currently seventh in the 12-team table, are preparing for their first playoff campaign since joining Super Rugby in 2011.
They play Fijian Drua away on Saturday ahead of a quarterfinal the following weekend, which could be their final game, and said they had been "dreading" the news.
"While this is undoubtedly a sad day for the Melbourne Rebels, the clarity that this decision provides for our players and staff is welcome," they said.
"The club will continue to work with RA and the Rugby Union Players Association regarding next steps for players and staff."
Australia will be left with four Super Rugby teams in 2025 – Brumbies, Reds, Western Force and Waratahs. New Zealand have five, with two Pacific sides also in the competition.
A handful of Wallabies play for the Rebels, including Carter Gordon, Taniela Tupou, Rob Leota, Lukhan Salakaia-Loto and Andrew Kellaway.
The club was scheduled to host a match in July 2025 against the touring British and Irish Lions. That is now off and Rugby Australia said they were "evaluating possibilities".
Consortium leader Clifford lashed out at the Rebels' axing as a "slap in the face" to rugby fans in Victoria state and threatened to sue the governing body.
He told media he had a plan to move the club to Melbourne's western suburbs, with Aus$18 million in funding.
"The consortium last week presented Rugby Australia with a detailed $18 million plan backed by local equity to not only save the Melbourne Rebels, but have them thrive in a new home in Tarneit in Melbourne's west," he said.
"This was a credible, financially viable and sustainable plan."