Take two successful companies, merge them and the idea is that the enlarged business will be even better, with increased scale, more assets, cost-savings and the ability to take from the best of both sides. In theory one plus one will equal more than two.
In pro cycling things are very different. Merge two teams and you’ve got one team that’s no bigger than before, and several headaches. So the recent reports that the Jumbo-Visma and Soudal-Quickstep teams could merge are perplexing. Unless the Dutch team really can’t find a sponsor.
Merge two equally sized brewers or bicycle makers and the enlarged company can twice the sales as a a combined group but save costs by having only one head office, plus gain extra market share and purchasing power, that’s the usual justification for corporate mergers. For cycling teams though rosters are capped so merging two squads of 30 riders is carnage, 30+30 has to equal 30 or fewer. Riders have to be released, likewise support staff. Plus all this is disruptive as management time is consumed, cultures clash and so on. It’s why mergers in pro cycling have been more akin to shotgun weddings, arranged in haste to ensure a team survives, think Garmin and Cervélo; or admin measures like Wanty picking up the old CCC World Tour team licence.
Looking at a Jumbo-Visma merger with Soudal-Quickstep, we first got a report on Wielerflits. Since then Soudal-Quickstep management have emailed their riders to say “there have been ongoing discussions with a number of parties in the last months” and “there are no concrete projects” so we know talks are happening but no deal is done. “Concrete” can mean an inked deal so everything could be in place up to this final step. Or not of course… but they wouldn’t be emailing riders if this was a non-story.
Just imagine how strong a combined team would be with Vingegaard, Roglič, Van Aert, Kooij, Kuss, Laporte, Van Baarle, Jorgenson, Staune-Mittet and more. And these are the just the Jumbo-Visma riders. Quickstep’s still a great team but they’re clearly not the force they used to be and you name the niche – GC rider, classics contender, sprinter, workhorse – and the Dutch team already has it filled. Bringing Evenepoel on board would make them even stronger but how to manage his ambitions of winning the Tour with those of others like Jonas Vingegaard who expect to be leader in July and have a track record of delivery too? Plus of the two galactic riders at the Belgian team (legally Luxembourg-registered of course), they’ve been talking about unloading one and other’s talked about leaving: Patrick Lefevere’s been public about the wage costs of Julian Alaphilippe; while big star Remco Evenepoel and his entourage spent the height of summer talking to other teams before being reminded they have a contract but he’s clearly looking to move and the team would be too top heavy with him on board.
What’s the one thing Soudal-Quickstep has that Jumbo-Visma doesn’t? Sponsorship perhaps. Jumbo’s deal can last until the end of the end of next season but the Dutch team needs financing beyond this, and needs it today. It has to budget for the years to come and also reassure riders and their agents that they’re good for the money in the years to come, there’s no point signing a contract with a team if the money is going to dry up.
Jumbo-Visma doesn’t have the biggest budget in the World Tour but its costs have jumped. The wage bill has grown, bonuses add up, plus it seems expense items like training camps and support staff taken on in the dream to win the Tour de France have now become the team’s base case for annual spending. Put simply the team’s costs have risen significantly and it needs a hefty replacement title sponsor.
But as we’ve seen with Soudal itself, sponsors can move around teams. Soudal used to sponsor the team known today as Lotto-Dstny, indeed there’s a merry-go-round of Flemish sponsors that hop among squads over the years. So a merger is a complicated way for Jumbo-Visma to tap into this cashflow but it maybe the only route because as much as sponsors can hop about, it’s not done at the click of fingers and maybe Soudal could be tied in contractually for some time.
Soudal is an interesting case as it’s a relatively big business that’s owned by a family, notably founder Vic Swerts, pictured, who likes his sport, a deal can make commercial sense but also please the owner. He’d surely like to have Remco Evenepoel on board as everything else being equal he’d probably want to win the Tour with a Belgian rider more than a Dane. So Evenepoel’s exit to Ineos isn’t so simple, stay and he’d be on board with a team that is winning grand tours, has the infrastructure to back him and also a sponsor behind him.
As a thought exercise, is Evenepoel the asset that’s underpinning Quickstep, or a symptom of the team’s demise as they struggle to back his ambitions, cannibalising their Wolfpack “a lot of them win a lot” style? It’s worthy of a separate discussion but merger talk seems to reveal exit routes for Patrick Lefevere and the team’s reduced status. Talk of Lefevere sitting on an “advisory board” is jargon for taking a step back (sidenote: Jumbo-Visma boss Richard Plugge probably doesn’t need much advice).
Another tangent is that this isn’t the first merger story of the year. We’ve had Ineos and Soudal-Quickstep which is interesting as again the Belgian team is trying to combine in order to continue and it’s also an exit route for Patrick Lefevere although he can can always retire and enjoy both his wine cellar and his status as the Don of Flemish road cycling without a complicated merger. There’s also the merger where Ineos was said to take on the whole Quickstep team as a means of securing Evenepoel. That’s akin to buying a car dealership just because you want one of the cars parked on the forecourt. But Ineos’s issues aren’t over given their rider exodus with Luke Plapp yet another leaving; and the other chatter was a merger with Movistar, unlikely but you wonder if something has to happen with the British team.
Bike sponsors can play a role but it’s between Pon, by some measures the world’s largest bicycle company and owner of the Cervélo brand, and Specialized with its big marketing budget where it hard three teams in the last Tour de France and you can set your watch to the timing of their press releases and product launches in the cycling media. So no advantage or big angle here, both will pay a premium to back a top team.
Of course there’s more than the men’s teams. Jumbo-Visma have their in-house women’s team, but the AG Insurance–Soudal–Quick-Step team is not a direct part of the Soudal-Quickstep team in the same way, but given the shared sponsors, they’re inevitably part of the merger outcome even if they’re not at the table.
Also there’s the rest of the World Tour. Should any World Tour teams merge, combining two teams means one of their WorldTeam licences gets sent back to the UCI. A licence can be valuable if there are more applicants than places for the World Tour but if there isn’t any clamour from an extra team to get promoted then the licence itself isn’t valuable, see Katusha’s old licence selling for one Euro or Intermarché getting into the World Tour after picking up the old BMC/CCC licence for next to nothing. Anyway if Quickstep probably won’t be able to sell the licence to recoup any costs spend on a merger, one consequence here is that a team with ambitions for the World Tour can apply as there could be a place freed up. Lotto-Dstny, Israel-PremierTech and Uno-X will all be interested but they’re all in the “goldilocks” position of being neither too hot when it comes to costs nor being frozen out: they’re almost guaranteed a Tour start but without the added costs of being a World Tour team.
The current merger story is just the latest merger version with Quickstep involved. “Why?” was the thought on reading news that Jumbo-Visma and Soudal-Quickstep could combine. Pro cycling team mergers don’t work in the classic way, they’ve often only made sense when two imploding teams had to combine to survive, it’s been more about 0.5+0.5=1 than 1+1=2. They’re defensive measures rather than expansion plans and one good reason for a merger could be a means for the Dutch team to tap the Belgian team’s sponsors.