Balmain would consider selling part of their stake in Wests Tigers to a private investor if a stand-off over a $1 million financial shortfall cannot be resolved.
As reported by Fairfax Media on Wednesday, the Wests Tigers joint venture partners are at loggerheads over control of the club, with the Wests Group prepared only to provide an urgent $1 million cash injection in return for an additional seat on the board and the chairmanship for three years.
Balmain, who do not have the money to contribute to the shortfall, want independent directors to run the club and are in talks with the NRL about changes to the club's governance in return for a financial rescue package.
But if the Magpies do not agree to the terms of an NRL bailout, Fairfax Media has been told that selling part of their stake was ''definitely'' an option Balmain would consider and can reveal that talks have been held with potential investors.
Sources said former Wests Tigers chief executive Stephen Humphreys had held discussions with Primo Smallgoods owner Paul Lederer, who is a director of Western Sydney Wanderers and has been linked to a stake in the A-League franchise.
Fairfax Media has been told that neither Balmain nor Wests Tigers actively sought private investors but potential buyers approached the club from time to time. Balmain's preferred option is for a board restructure and officials believe that under the control of independent directors, Wests Tigers would be run so efficiently that no further financial injections would be required from them or the Magpies.
To do so would require the support of Western Suburbs but the Magpies may prefer to take the opportunity to right some of the perceived imbalances in the joint venture over its 14 seasons as Wests Ashfield has the capacity to foot any future bills.
If the Wests Group rejects moves to install independent directors, Balmain will consider other options - including selling some of their 50 per cent stake in Wests Tigers, who have had a season to forget on the field due to a raft of injuries and the poor form of several players.
Illawarra went down a similar path in 2006 when the Steelers sold a 25 per cent share in the Dragons to WIN Corporation to cover debts to St George incurred in the first seven years of the joint venture. As part of the deal, WIN chairman Andrew Gordon was given one of the Steelers' four seats on the St George Illawarra board, while the Dragons play at WIN Stadium in Wollongong and WIN Jubilee Oval at Kogarah.
Balmain directors met on Tuesday night to consider their response to the Magpies proposal, which would give the Wests Group control of the joint venture, but after rejecting a similar bid to change the club's shareholding they are expected to do so again at next Thursday's meeting of the Wests Tigers board. Those on the Wests side of the joint venture believe their Balmain counterparts may be worried that they will want to change the club's nickname from the Tigers to the Magpies.
However, Magpies officials have stated publicly that they will maintain the Wests Tigers identity if they are in control of the club and are not angling for a full takeover similar to Manly's dumping of North Sydney from the failed Northern Eagles joint venture. To do so would risk alienating more than two-thirds of the club's supporter base, including a generation of fans who have grown up supporting Wests Tigers since their foundation season in 2000.
But greater power going to the Wests Group may mean the association between Balmain and the Wests Tigers brand and identity is reduced to the same level as the Magpies.
Twitter - @BradWalterSMH