When two become one

Monday, 5 September 2011

Leopard mating

The news that Radioshack and Leopard-Trek are “merging” confirms Flavio Becca’s interest in cycling is not on the same level as Swiss billionaire Andy Rihs, although that’s been clear from the start, just not so obvious.

Luxembourg’s Becca has decided to invest in pro cycling and wants to have a team with sponsors paying the wage bill and operating expenses rather than funding things from his bank account.

It’s been easy to snipe at Leopard this year as a nearly team. Legendary cycling manager Cyrille Guimard said it took him three to five years to make a team start working; Team Sky needed a season to learn the ropes. So it feels impatient to shake things up so suddenly, you wonder if the newly merged squad goes back to the beginning again.

Something had been up with the Radioshack team, riders heading for the exit and no replacements. I still can’t see the interest for the US electronics retailer in funding a team that spends 90% of its time in Europe given that star attraction Lance Armstrong has retired. For sure, publicity in California, Utah and Colorado represent a marketing return but this success in the US might be hard to repeat. I suspect Nissan and Trek are happier.

Even assuming Radioshack was on the way out, the way this happens in September is pretty sudden. This evening’s press release leaves more questions than answers:

  • How long was this in the pipeline?
  • Is Flavio Becca the driving force behind this? Don’t underestimate the influence of Frank Schleck here and it’d be interesting to know if Johan Bruyneel has a hired hand or a dealmaker.
  • How can a team be formed just 10 weeks away from the UCI’s Licence Commission review?
  • How can teams with ProTeam status vaporise within less than 11 months?
  • Which team’s licence will go forward for 2012 (ie who owns the team?)
  • Two big teams aren’t really merging, this is the combo of two shrunken team so what about the riders and staff getting excluded?
  • Just how much “new money” is coming from the sponsors?
  • When will we get more detail?

Either way this creates a strange situation where Radioshack looks to have been “wound down” for some time with several riders not seeing their contracts renewed in order to shrink the squad down to the size needed to merge with Leopard-Trek. Mergers are normally a means of combining assets, not shedding them.

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{ 30 comments }

natalie September 6, 2011 at 12:26 am

There are many things I don’t like about this situation but even more things that I don’t understand, the latter being more legitimate than the gut emotional reaction.

Radioshack contracted two riders (Meersman and Gallopin), two were transferred to Leopard Trek (Rast and Hermans). Why would transfers be taking place if this had been in the pipeline for a while? Rumours suggest it could have been as far back as the Tour when Becca’s support was wavering. Add to that the strange business that was Radioshack confirming Horner, Kloeden and Brajkovic’s contract extensions but nothing about Levi. Did Levi know something was in the water? Something big enough to make him consider a European team was better for him, a team with fewer GC rivals no less. It seems to be a mix of something going on but hiding behind a veneer of pretending things are normal.

The particularly ugly part of this to me (making no cheap shots about Bruyneel…), is that riders didn’t seem to know what was happening. Not only leaving it so late in the season to make such a huge change but to not even inform the riders seems unnecessarily messy and cruel. There are decent ways to go about things and this wasn’t it. Even if the face of increasingly noisy rumours, this should have been done better to respect the guys involved.
I’ll echo what I said on twitter which is that I am no Kim Andersen fan but for him to not even know is out of line (http://sporten.tv2.dk/cykling/article.php/id-43373027:kim-andersen-havde-intet-h%C3%B8rt.html) and suggests there are machinations at work designed to exclude and get the team make-up they want regardless of how it comes about. It’s unpleasant to witness.

I think you’re completely right to question Frank Schleck’s awareness of the situation, given past behaviour about the formation of the team. On the flipside of that, I appreciate Fuglsang’s candid disappointment (http://sporten.tv2.dk/cykling/article.php/id-43356505:fuglsang-skuffet-over-leopard.htmll) – which, given his closeness to the brothers, really does seem to suggest that if the Schlecks are involved they kept their cards close to their chests.

I’ve mocked the Leopards for their arrogance this year but I was fully expecting them to “do a Sky” and refocus as required for the coming years. Head out the asses a bit and forge on. Now we’ll never know and was this always the plan really? Why did four years become barely more than six months?
I have lots of questions! :) I’ve not even started on the contract business, I don’t fully understand that either. How can they push riders out of contracts if they’ve signed up for two years?

I think it’s possible that they were forced to announce this before they wanted to because news was leaking out but then that would also indicate that they had no qualms about leaving it even later in the day to shed riders and leave them out of contract for next year. With many teams having accommodated homeless HighRoad riders, there isn’t much space out there.

natalie September 6, 2011 at 12:28 am

Long comment above! Apologies. Questions are not specifically directed to @inrng to answer, just questions that are rattling around in my head.

barbara September 6, 2011 at 1:27 am

Last year, after B. Riis contracted Contador, I was completely sure that the new Lux team would contract Bruyneel. It didn’t happen then and now it feels like “a little too late and so on” .
I’m now wondering where the impatience comes from, probably it has something to do with the BMC roster, but I don’t think JB can be the savior all by his own.

What will happen with Mercedez, will all their cars/busses be replaced by Nissan? Weird.

CGradeCyclist September 6, 2011 at 2:10 am

In a lot of ways, it makes sense to me. I’ve long thought there were too many teams for the amount of top-level sponsorship available – so the Omega Pharma/Quickstep merger,and now the Leopard/Radioshack merger make total sense. Only surprise is that HTC weren’t able to merge with a existing team as well.

Perhaps there is an opportunity here to rationalise the number of WorldTour level teams – wind it back to, say 15 WorldTour licences altogether. That’ll help ‘concentrate’ sponsorship and make teams hopefully more financially stable.

Other point is (well said by natalie) – what about the riders?? I’ve mentioned before that the riders need a strong, vocal ‘union’ with some clout. The riders are the one flogging themselves on the roads for our entertainment, they shouldn’t be the last to know and have their future income jeopardised so easily…

Larry T. September 6, 2011 at 2:52 am

Sounds fairly simple to me though the details about the no-longer-needed riders might be sticky. It’s a bit late for these guys to find new teams, no? Looking back on this I find it interesting the public spat between certain team managers and the UCI, with a threat of a boycott of the upcoming Chinese tour died away recently with the announcement that all the teams would participate according to UCI. Did a certain someone “make nice” with the UCI in order to make this merger possible? It’s hard to imagine the suddenly jobless riders won’t get screwed out of their contractually obligated salary and benefits somehow. For the Wisconsin bike maker especially, this is a deal made-in-heaven as they no longer need to equip two teams now right? They get the experienced management and organization of “Retirement Shack” (we presume) and the fresher, younger talent from Leopard to combine into a super-team to rival BMC. I’m sure no matter what the current rules say, all this will be blessed and encouraged by the UCI, while the redundant staff and riders scramble to find employment elsewhere. As they say, “It’s just business, no hard feelings, eh?” And maybe the UCI will now limit the big-league teams to less than the current number, leaving more room for the race organizers to add wild-card entries? For me that might be the silver lining in the dark RadioSchleck cloud.

Evan September 6, 2011 at 5:29 am

in response to one of the questions above, cycling news reports “Leopard will continue to hold its existing UCI WorldTour License”

SlapshotJC September 6, 2011 at 9:23 am

Sad day for cycling, rules look to be flouted to suit and Bruyneel get his hands on another team. The sport cannot move forward until he’s history…..Andy Schleck’s TT will be “unbelieveable” next season!

El Gato de la Cala September 6, 2011 at 10:21 am

Is this good, or is it bad for the sport of professionally cycling? On the long term good, as we still have one professionally cycling team running instead of two more teams closed down – and bad as this has shown what it is all about: MONEY! Well I think that (if not the only one) “The German Wheel” is happy now probably getting a second chance for a round of “Andy-Warhol-5-minutes-of-fame” doing what he is best at, just like he did at the first Leopard-Trek presentation! This was the worst ever team presentation who as a matter of facts said more about Flavio Becca than any words ever spoken public. If any at all! RTL LUX sponsored the whole scenario and Becca sat front row smiling, not because of being well entertained, but because someone else just paid the bill. Have a exiting peek here of what top performer “The German Wheel” can do – fasten seatbelt and put on your Flavio smile as it is for free: http://www.boreme.com/posting.php?id=26383

flammecast September 6, 2011 at 10:37 am

I don’t think this is as sudden as we all make out, remember a few months back there was talks of Armstrong managing Leopard Trek ? I reckon this was underway with a long while.

Matt September 6, 2011 at 11:16 am

What are the chances that the UCI will suddenly grow a pair and make an announcement that LeopardMercedesNissanTrekBruyneelShack don’t fulfill the sporting criteria for a ProTeam license?

Ronan September 6, 2011 at 11:49 am

It’s times like this that the riders really need representation. What will happen to the guys who fall out of the magic 30 for this new team and have no UCI points to bring to a new team?

xouted.com September 6, 2011 at 12:04 pm

The name will be “LeoShack” or “RadioPard”? ;-) I did some logo http://xouted.com/wp-content/uploads/2011/09/leoshack.png ;-P

TomH September 6, 2011 at 2:48 pm

Solid point Ronan, I think that doping allegations hit cycling harder because cyclists and teams don’t seem to be united with each party being properly represented. If I’m correct at least one major Spanish football team was involved in the Fuentes investigation but mainstream media never really dug any deeper. Maybe cycling is the easier target for the media because the lack unity and therefore defense.

INRNG, could you shed some light on this when you’re back?

Touriste-Routier September 6, 2011 at 3:21 pm

@natalie It is normal in a merger or acquisition for the employees to not know about it until things are official (or just about to be). The more people who know about the merger, the more news leaks, and the more likely the deal goes bad. Also, you don’t want your employees distracted, or distracting you while you are negotiating final contracts.

The best practice typically is for executive management to conclude the deal and speak to the employees before making it public. In the case of “public companies” (as opposed to privately owned), this is sometimes complicated by disclosure/securities laws.

OJT September 6, 2011 at 4:51 pm

I totally agree with your questions about the riders. Many serious issues seem to have been glossed over in the press statements and I share the concerns of the other commenters on this post.

We do have some illuminating details on the ‘merger’ though. The ongoing racing licence appears to be Leopard’s. In other words, The ‘Shack’s licence is being quietly dropped and CSE are now only handling the marketing. Bruyneel will run the sporting side. So the tree pillars of the team – publicity, UCI registration and team management – are separated. This should help contain the likely fallout from the US FDA investigation. My suspicion is that Levi’s absence from the new team may well be connected to the investigation. Time will tell.

On a lighter note, my suggestion of future team name is “ShackOPard”.

jaas September 6, 2011 at 5:24 pm

I think you mean “RadiOpard” or “LeoShack presented by the soon to be discontinued 2012 Nissan Leaf”

on a serious note….has anyone ever bought anything from Radioshack?

Larry T. September 6, 2011 at 7:12 pm

What, you don’t like RADIOSCHLECK? This will be even more true if “The Belgian” and other team bigwigs are successful in overturning the radio earpiece ban. As to Radioshack USA retail stores, they’re overpriced, grimy and our local outlet won’t even take back dead batteries for recycling! When they decided to sponsor BigTex and Co. I figured I could find anything in their store elsewhere and decided to do just that. I was amazed they continued their sponsorship deal for another two years, but am far less amazed after these recent developments. The darlings of TV’s “Heckyl and Jeckyl” might just help them sell some stuff. The chamois-sniffing commentary on the recent Colorado race made it clear to me just how much the Schleck bros are almost worshipped in the USA…now that they’re on the BigTex team the fanboy love should just increase, no?

ElBeeJay September 6, 2011 at 7:27 pm

what a disgrace. UCI haven’t intervened despite the total lack of communication to riders and staff.

On the olther hand: That’s what you could expext from the fat cats in Nyon who may already be in Beijing to prepare the world for the utmost idiotic Tour of erh…whatever

To learn the Armstrong will stay put with his Dracula in the surroundings of the Schlecks along with Bruyneel is also pretty discouraging. Hopefully FBI will speed up the investigation to nail the biggest crook of all

jess September 6, 2011 at 7:28 pm

Hmm, this reminds me of Patrick Bateman in brett easton Ellis’s excellent ‘american psycho’ ……he tells someone he works in murders and executions – instead of mergers and aquisitions….

jyd September 6, 2011 at 8:12 pm

Jens Voight riding for Bruyneel. Like nails on a chalk board. Oh the humanity!

Higgins September 6, 2011 at 8:48 pm

How sad. In football, teams have over 100 years of heritage in many cases, and this adds to the romance of following a team sport. It would be lovely to see someone riding in the legendary Bianchi squad, or the Molteni colors etc etc, but in this sport, it seems that only events themselves have a long lasting status.
Its a way of selling new kit every year, but to become a truly financially stable sport, I would have thought that making the team itself a recognised brand in its own right instead of changing names with every sponsorship deal would be a more sustainable approach.

OllytheWheeler September 6, 2011 at 11:28 pm

I’m not overly fussed about the merger, in sporting terms it just combines two underperforming teams in an environment devoid of sponsors. However, my concern is with the riders who will inevitably be jobless, due to the 28 rider cap. With the demise of HTC-HR, and the shinanigans at OM-PL and QuickStep, this leaves a gap of major World Tour teams, by my reckoning, of 1 (when you include Green Edge), will we see a new team? I doubt it, so Skill-Shimano will step in, who already have a decent, young team (and Degenkolb). I can only see this surplus of labour having the effect of reducing wages for ‘average’ pros, whilst raising wages for each teams stars, not a pleasing prospect.

Velonista September 6, 2011 at 11:55 pm

Isn’t Jens Voigt likely one of the riders to lose out here? I thought he was on a one-year contract that ended at the end of 2011.

The Inner Ring September 7, 2011 at 12:15 am

Thanks for all the comments, plenty of interest.

One point I didn’t run with in the piece above is that this isn’t really a merger. It’s more as if Radioshack were thinned out to be able to take the sponsors over to Leopard. For me it’s interesting to see a top flight team just wind down within the space of a few weeks.

Mick September 7, 2011 at 5:34 am

It seems that JB also wants to minimize any or all need to travel to the US…hitching his cart to the rebranded Leopard prevents any or all need to be in the US for the foreseeable future. The whole winding down of the current RS smacks of cutting bait and hightailing it out…I suspect there are a few very interesting angles to this saga behind the scenes…Oh to be a fly on the wall during this whole (I’ll incorrectly refer to it as a ) merger.

Bundle September 7, 2011 at 11:25 am

Any idea where Cancellara is going? Seeing him in the Vuelta, with not even one Schleck to help, I wonder what the man is about, career-wise.

Melted tarmac September 7, 2011 at 2:53 pm

INRNG: “Mergers are normally a means of combining assets, not shedding them”.

So true. One can only wonder if 2012 will be a new “learning” year for Leopard/Radioshack. What can they possibly gain from that? And what about Cancellara, will he once again be on his own when the classic are decided? Such a shame.

BMC and Sky will be the super teams of 2012. Not Leopard/Radioshack.

El Gato de La Cala September 7, 2011 at 4:46 pm

Have a look at this John Burke (Trek Bicycle Corporation President) & Flavio Becca interview after TDF stage 20. Bear in mind that Flavio tricked Trek into paying out Team Saxo-Bank app 1,3 mio € and didn´t reach for the pocket him self signing Cancellara. http://www.youtube.com/watch?v=FfmtihSC56k

Simma September 9, 2011 at 1:32 am

25 riders + 11… aaaand JB has just signed Voight for next season making it 37 o.O wonder which riders are getting the boot for xmas… and how they’re going to legally do it? and how late they’re going to tell them they’ve dropped them as team places are few are far between now.

I love Voight and Cancellara but jeez it’s getting hard to support this team, and wtf is the management doing for Cancellara anyway? he’s one of the biggest riders on the team, unlike Shlecks he’s a proven winner, yet they don’t bolster the classic’s support, he can’t do it all himself with a 40-60k break every race (as proven this year rather embarrassingly).

natalie September 10, 2011 at 1:00 am

I mentioned this on twitter but it’s probably quite interesting for a wider audience than that: LeQuotidien.lu interview with Becca: http://www.lequotidien.lu/les-sports/26942.html

Lots of interesting things in there but the biggie would be the confirmation that the Schlecks were involved in it and for Bruyneel.

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