I wrote about the wealthiest men in cycling back in March 2010, but fortunes can come and go, and now there are new names to add to the list and some names to delete.
If you thought the likes of Alberto Contador, Mark Cavendish or Philippe Gilbert were the best paid in cycling, time to think again. It is the people behind the scenes who fund some of the pro teams that are the wealthiest. Read on and you will find the missing link between Damiano Cunego and Jennifer Lopez.
Andy Rihs – BMC Racing
The 2010 piece was a contest between Bob Stapleton, the telecoms entrepreneur behind the Highroad team, and Andy Rihs, but Stapleton has left the sport. Rihs – pictured above – is the Swiss owner of BMC bicycles and the big benefactor behind the BMC team. Perhaps you’ve played in a fantasy cycling league like Velogames and wanted more credits to buy extra players? Rihs is playing for real and has almost limitless resources to fund the team. That’s why he’s got the likes of Cadel Evans, Philippe Gilbert, Thor Hushovd and more on his team.
Rihs isn’t wealthy thanks to BMC bikes. Instead he founded a hearing aid business that went from his garage to a global consumer healthcare giant called Sonova (formerly known as Phonak) and at the time of writing it is worth about US$6.5 billion. Rihs still owns 10% of the business (a stake valued at $650 million) meaning he gets a giant haul of dividends from this profitable company.
He was richer back in 2010, but the stockmarket has fallen and, more specifically, an insider dealing probe saw the share price tumble and it has yet to recover. Fortunately for him and the BMC team, Rihs and senior executives were cleared, but the Swiss fell on his sword and resigned as Chairman of the company after some governance concerns were exposed. The fall in the share price cost him plenty, but he’s still a billionaire and has interests in watch-making and vineyards. He is also building an indoor velodrome in Switzerland.
Igor Makarov – Katusha
Russian tycoon Igor Makarov is a contender for the richest man in the sport, only nobody knows how much he is worth. If you read the Tinker, Tailor, Cyclist, Spy piece on here the other day you’ll know he is part of Russian Premier Vladimir Putin’s komanda of oligarch business owners. Makarov is probably a billionaire. He has appeared on Forbes’ rich list in the past based on the value of his declared holding in ITERA but it is possible he has greater wealth. His wealth via corporate ownership and other dealings is not exactly transparent. One piece by the Jamestown’s Institute’s Eurasia Daily Monitor makes some bold claims:
According to recently acquired documents, Makarov is the Ultimate Beneficiary Owner (UBO) of a slew of companies affiliated with Itera, many of which are registered in the British Virgin Islands (BVI) and other offshore tax havens including Cyprus, as well as in the Czech Republic, Germany, Italy, Russia, and the UK (confidential documents obtained by the author).
The article makes some even more bold claims, but I’ll leave those for now. Note the Jamestown Foundation is reputed to be a front for the CIA, a US intelligence agency with a possible interest in discrediting foreign countries and companies. Either way, it is certain that he owns several luxury properties including a villa on the shores of Lake Garda, just up the road from his Katusha team’s service course.
Sergey Taruta – Lampre ISD
You probably have not heard of Taruta nor his job as Chairman of the Board at the Industrial Union of Donbass in Ukraine. In Russian this business is known as Индустриальный Союз Донбасса and its Cyrillic initials, ИСД, are ISD in the Latin alphabet. It is the co-sponsor of the Lampre-ISD team, the Italian UCI Pro Team. When younger Taruta was keen on cycling and football and he is now wealthy to indulge these interests on a grand scale.
Born in 1955, Taruta is billionaire and reputedly Ukraine’s second richest man whilst estimates of his wealth range from US$1-3 billion. He started ISD in the early 1990s with Vitaly Gaiduk and the two metallurgists took over steel mills in the east of Ukraine. At one point they were exchanging Ukrainian steel for Turkmen gas with a certain Igor Makarov; such barter trades were common in those days, but it’s odd to think two pro teams can trace their genesis to this trade.
In fact, we can add a third team because oddly a young Kazakh student called Nursultan Nazarbayev worked during his student days in one of the steel mills owned by ISD before becoming President of Kazakhstan… and the patron of the Astana team. And read the piece on the Omega Pharma Quickstep team’s Zdeněk Bakala who has business dealings with ISD too. Four teams, one Ukrainian steel mill.
Taruta is an astute survivor, once close to the imprisoned ex-Prime Minister Yulia Tymoschenko he has now sold half of ISD to Russian interests backed by the Kremlin. The full story on Taruta, Makarov, Tymoschenko and others is for another day.
Taruta started the cycling team under the ISD name in 2007 and it grew into a Pro Continental level team with an Italian base. By 2009 the ISD team rode the Giro d’Italia. Come 2011 and Taruta switched sponsorship to the Lampre team, taking fellow Ukrainian Vitaliy Buts along with him.
He also owns the FC Donetsk football team – currently mid table in the Prima Liha – and funds the Kiev Sokols (“Falcons”), the Ukrainian de facto national ice hockey team. Taruta also backs many of the athletes who will be going to the Olympics this summer, but the Lampre team is ISD’s most high profile outlay.
Taruta doesn’t just spend his money on sports. When his daughter married the son of an Uzbek mining tycoon, he reportedly paid Jennifer Lopez $1.8 million to perform at the wedding.
James Murdoch – Team Sky
The younger son of Australian-American media mogul Rupert Murdoch, James is a British citizen and keen cyclist, a factor behind the creation of Team Sky. The British-based satellite TV company Sky is part-owned by the Murdoch family, and James was formerly a Chairman of the company, whilst he now runs News Corporation.
James Murdoch is not in the same league as Rihs, Makarov and Taruta for now but his ulimate fortune depends on the performance of News Corp and the will of Rupert Murdoch; he could inherit a business worth billions at some point in the future.
Marc Coucke – Omega Pharma-Quickstep
A pharmacist by training, Coucke co-founded Omega Pharma in 1987. A cycling fanatic, he has sponsored several cycling teams and today he has the likes of Tom Boonen, Sylvain Chavanel and Tony Martin riding, literally, in his colours.
Coucke is in the middle of acquiring Omega Pharma back from the stockmarket in a bid worth some €880 million. The company has been amongst the BEL-20 index of companies in Belgium, and with a big stake already in the business already, Coucke will be the owner of a large consumer healthcare and para-pharmaceutical business empire. A maverick at times, Coucke is known for his loud suits and pink shirts but doesn’t always live the life of a tycoon. Omega Pharma made profits of €70 million in 2010 and he’ll enjoy an even greater share of this soon, whilst being able to run Omega as his personal fiefdom. Don’t be surprised to see some big signings, but he is famously tough on prices and wages; he refused to pay the wage demands of Philippe Gilbert and in 2009 gave up his Bentley for a Skoda.
Zdeněk Bakala – Omega Pharma-Quickstep
Co-owner of the team with Marc Coucke, Bakala is a billionaire financier from the Czech Republic and sits on the Forbes list of the most wealthy people in the world. He crossed the Iron Curtain for business school education in the US and then became an investment banker and soon returned to open the offices of Credit Suisse in Prague, then at the frontier of capitalism. In time he then started his own bank and later sold this to a Belgian bank to make his fortune.
He then parleyed this capital in to a range of businesses interests from mining to restaurants, including one of Europe’s largest coal and iron operations in Ukraine and Poland, one that works very closely with Taruta and ISD. Business New Europe describes the deal in the September 2008 edition:
Zdenek Bakala… is widely regarded as having pulled off one of the deals of the decade by doing a leveraged buyout of the coal miner for a reputed €400m in November of 2004, then set about stripping out assets worth around €2bn, and then flogging off the remains to an eager market that valued the firm at €4.5bn.
Just over a year ago he bought the Quickstep cycling team with Bessel Kok, a telecoms executive he worked closely with during an aborted bid to privatise the Czech national telecoms business. Indeed just as he tried to reshape the telecoms sector, he is interested in pro cycling’s strategic and financial future and has spoken about reform.
He was instrumental in building the Havel library in Prague and organised the late Vaclav Havel’s birthday party last year. He now lives with a former Miss Czechoslovakia and their three children. Note the presence of compatriots Zdenek Stybar and Frantisek Rabon on the team, no coincidence.
Gerry Ryan – Greenedge
The Australian entrepreneur founded Jayco, a long time supporter of cycling ‘down under’. Today he is the man behind the Greenedge cycling team and funding it until a sponsor is found. Reports have put Gerry Ryan’s net worth at around $180 million Aussie dollars. Ryan’s son Andrew is also closely involved in the Greenedge cycling project and Gerry said:
“my son Andrew whose role is sponsorship, has the greatest incentive to go out there and make it happen because it’s his inheritance that I’m spending”.
As well as funding a big cycling team he has a passion for horse racing and his horse Americain won the Melbourne Cup, Australia’s biggest race in 2010 and he has a stud farm. Down the road from this he also owns a good sized vineyard too. Over the past 20 years Ryan has funded Aussie football, rugby league, basketball, cricket, motocross and even lawn bowls. But Greenedge is the biggest project so far.
Flavio Becca – Radioshack-Nissan
The Luxembourg real estate and sporting mogul Flavio Becca remains in pro cycling. After launching in 2011 in front of Luxembourg’s royalty, the Leopard team went from fanfare to, less than a year later, being folded into Radioshack. This was largely because the team did not attract a sponsor and Becca was losing a lot of money as a consequence. 2011 wasn’t a vintage year for him after headlines in the autumn reported his home and offices being raided by police.
Becca is the owner of several Quick burger bar franchises, a hotel and sports stadium in the Duchy. 2012 should be better as he is involved in a project to built a national sports stadium with a large retail mall attached. Negotiations are ongoing and we’ll see if Becca stays in pro cycling. A millionaire many times over, the native Italian somehow looks impoverished compared to some of the others listed above.