WHY ERNESTO REFUSED TO SETTLE - Americas Cup

Last week the Prince of Alinghi refused to settle, and tried to bully the Challengers into not signing Oracle's 'very reasonable offer' as many in the media called it. Why? Follow the money.

Today's AC campaigns cost out at least two million per month. That's 24m per year. 48m for two years; 96m for four years. More if you are a big campaign. It is almost that simple.

That's why the Challengers are demanding an event in 2009, not 2010 or 2011, and why Oracle insisted on 2009 in their settlement offer, which was backed privately by all five challengers and co-signed by three of them. The two weaklings buckled under the weight of Ernesto's threats.

Why 2009? Any later and the challengers will simply die on the vine for lack of budget.

Then why did Ernie refuse to settle for 2009 and is now saying he will delay until 2011? Because Alinghi/ACM have no money for a 2009 event, and 2010 is Football World Cup (soccer for you seppos).

Ernie has no money? Not exactly. But he is Swiss and does not want to spend one Swiss franc of his family's billions. He broke even on Alinghi's win in 2003, and reaped tens of millions with the 2007 win.

But this time he won ugly, and almost lost to Team NZ in the process. Time to act to protect his cash cow. How? Simple, get total control of the event.

Ernie's boyhood buddy and ACM CEO Michel Bonnefous, and lawyers Lucien Masmejan and Hamish Ross, created a shambolic Challenger of Record, and issued a shameful, one-sided Protocol for the 33rd AC vesting all power in the Defender. Embarrassed Alinghi team members say that Bonnefous, when returning to the Alinghi base with the signed Protocol, gleefully exclaimed 'Now we can fuck everyone!'

Immediately seven of the eleven 2007 Challengers wrote saying the Protocol was "the worst text in the history of the America's Cup."

Within days 25-year AC sponsor Louis Vuitton pulled out, as did three-time mega-team sponsor Prada.

Seeing a disaster in the making, and that he had little chance to win against such a Protocol, Larry Ellison tried to file a challenge through the former challenger of record, GGYC, and keep the old Protocol, but was rejected by the Defender. His reply, "Sue the bastards."

Now the mess created by Alinghi's ugly win, ACM's pitiful promotion of the 32nd Cup event, the putrid 33rd Protocol, and Ellison's lawsuit, have caused most of the other sponsors - Ernesto's and others - to bolt including Areva, Banco Santander, Banco Madrid, Capitalia, Endessa, Red Bull and T-Systems.

So we await the ruling, which could come any day, of the lawsuit in the New York State courts that oversee the age-old Deed of Gift governing the 'Auld Mug'. Almost everyone outside of Alinghi hopes, and expects, GGYC to prevail.

In the meantime, not only does Ernie's ACM have no sponsors, Madrid is fighting Valencia over money and control of the event. Ernie guaranteed them 10 teams, he only has six, and ACM incurs a 10 million euro reduction in their fee from Valencia for each team below 10. Another 40 million euro hit if he does not delay and find more teams.

As bad as all that is, Ernie could still stumble on - until 31st October when he lost even his own team sponsor, UBS. That was the straw that broke the cow's back. Since then he ordered his people to bin 2009, blame it on the Spanish government and Oracle, and head for the hills until 2011. No wonder Alinghi team members abandoned their houses and apartments in Valencia even while Ernie issued new class rules and event regulations, and let the other teams ramp up in false hope there would be a 2009 Cup.

As if that were not enough, UBS - and Ernie is a Board member - have even bigger problems.

Follow the money. How now Swiss cow?

Submit Articles: http://getmynamedown.com

Article from the very popular website - Sailing Anarchy

Please Rate this Article

5 out of 54 out of 53 out of 52 out of 51 out of 5 

Not yet Rated