The America’s Cup is back on the economic front. It is recent news that the New Zealand team, winner of the last edition, rejected the New Zealand government’s offer of $75 million to keep the next edition in New Zealand. What’s behind it? Business. The choice of America’s Cup venue has become a matter of money, a lot of money. And there is a precedent. In 2007, Alinghi of Switzerland after winning the Cup put the venue up for grabs to the highest bidder. Spain’s Valencia won.
HERE’S WHAT HAPPENED
New Zealand media reported that the Defenders rejected a combined offer of about US$75 million from the New Zealand government and the city of Auckland for the right to remain as the venue for the next challenge. They want more and are negotiating the location of the event around the world, without precluding anything.
However, it is likely to be a strategic leak to leverage supply. The government and the Council have the right to the “first best offer” until mid-June, then everything will be open. But who else would want to accept?
New Zealanders are also struggling financially: what they paid for the last America’s Cup was supposed to be recouped through two America’s Cup “cycles.” Then COVID restrictions caused a huge hole compared to the estimated revenue for the just-completed first series.
And there is another twist. What happens if Emirates Team NZ accepts the Deed of Gift challenge from the British team, INEOS Team – and loses? Who would then own the rights? The whole thing is dark – and has nothing to do with sailing.
But why is it possible to move the regatta venue away from the defender country of the world’s oldest sports trophy? We owe it to Alinghi, which won the Cup in 2003. Without an adequate body of water in Switzerland, the defenders made a deal with Valencia. This was the precedent that then brought the Cup to Bermuda, for example. And that could cause another “move” of Cup…
We are going to see some good things. As in every America’s Cup now…
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