Breakaway cycling series underway?

Home » Headline, Road Racing News

Bloomberg News reports today that Radioshack – Nissan – Trek and seven other Pro Tour teams have agreed to participate in a new round of bike races that are being called World Series Cycling. The series, which is to be run by sports marketing company Gifted Group Ltd., is being called a breakaway league by the UCI.

Teams are said to be attracted by the new model, as those participating will receive 64% of the equity from the races. The financial arrangements would lessen the dependency of teams on sponsors that may be reluctant to cough up the $10 million dollars needed to support a top level team. The business model for the series would be closer in style to the team franchise plan that is used by the NBA and the NFL, where the team franchise owners get a percentage of TV revenues. Gifted Group and its backers aim to turn the series into a global brand, much like that seen in Champions League Soccer and Formula One racing.

If I do the math correctly, it looks like the participating teams would have to “buy-in” to the league for around $8 million each. Financial backers being courted by Gilt Group would own 27% of the equity while Gilt Group themselves would own 10% of the league.

The UCI, while not officially commenting on the plans, is said to be displeased with the new league, saying that it threatens the viability of long standing (but financially struggling) events like the Tour of Switzerland and the Clasica San Sebastian. In January, UCI President Pat McQuaid also said that the league would struggle because cycling is not as television

To read the whole story, visit here: http://www.bikeworldnews.com/2012/03/09/breakaway-cycling-series-underway/

Related posts: