Umhlathuze municipality consider legal recourse should Thanda sale go through
The City of Umhlathuze will consider legal recourse against Thanda Royal Zulu if the sale of the team's Premier Soccer League (PSL) franchise goes through‚ said the municipality’s communications manager‚ Mdu Ncalane.
The municipality‚ which includes harbour town Richards Bay in northern KwaZulu-Natal‚ has invested financially in Thanda’s promotion to the PSL this past season as National First Division (NFD)‚ Ncalane said.
Umhlathuze municipality have instructed their lawyers to investigate if there is any legal recourse they could be due should Thanda’s proposed sale of the franchise to Durban NFD club AmaZulu be passed by the PSL.
The terms of the sale have been agreed on between the two clubs‚ with the PSL just needing to add their stamp of approval. A league executive committee meeting on Thursday did not pass the sale‚ with some outstanding issues to be resolved by Thanda and AmaZulu.
“Obviously we are not happy with the deal. Because it deprives us of an opportunity to have a PSL team‚” Ncalane said on Tuesday.
The Umhlathuze municipality had written a letter to the PSL asking them to consider the city‚ and not approve the deal.
The municipality has sponsored Thanda for “about four years”‚ Ncalane said.
The City also upgraded the lights at Thanda’s home ground‚ Umhlathuze Sports Complex‚ in the past year to Fifa-accredited standard at a cost of R14 million.
They had entered into a R15 million three-year sponsorship (R5m a year) deal with Thanda‚ signed in April‚ which stipulated that the team would not leave the city.
Ncalane said the municipality was expecting returns of far more than that R15 million and the money spent on the stadium from the spinoffs of having a PSL team in the city‚ such as hosting of big matches against teams like Kaizer Chiefs‚ Orlando Pirates and Mamelodi Sundowns.
“What we have instructed our legal team to do – besides writing to the PSL‚ begging them to not proceed with the deal – is to look into the contract that we have signed with the team‚” Ncalane said.
“We are not at odds with the PSL. We had nothing to do with the PSL. We had an agreement with the team.
“We have to look into the legalities in terms of the contracts that we signed.
“Luckily the R15 million sponsorship investment was not through yet‚ because it was to be used in the coming seasons.
“We cannot say that they must bring back the money that we invested in the stadium facilities‚ because the facility will remain with us.
“But there are contractual obligations that our lawyers have to look into … in terms of breach of contract.
“Currently we are not aware how much that would be‚ or how we would go about it.”
Ncalane said the city would also explore whether there was any recourse for what they have spent on their stadium.
“Maybe – I don’t know‚ I’m not a lawyer – but maybe‚ out of the deal (to sell the franchise) a certain portion should come back (to the council)‚” he said.
Thanda chairman Pierre Delvaux could not be reached for contact.