UCI slates Pegasus Sports team over serious financial shortcomings
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Thursday, December 23, 2010

UCI slates Pegasus Sports team over serious financial shortcomings

by Shane Stokes at 9:29 AM EST   comments
Categories: Pro Cycling
 

Pegasus SportsThree days after announcing that the Pegasus Sports team had failed in its bid to secure a Pro Continental licence for 2011, the UCI has explained the reasons for the decision and what it says were ‘serious shortcomings’ in terms of the team’s finances.

According to the governing body, no bank guarantee was provided when the team made its final submission by the extended deadline of December 15th. It adds that financial guarantees for the 2011 season were also missing, apparently contradicting the team’s claims that one of its existing sponsors had increased its budget in order to cover the initial shortfall, and that a major European sponsor was also waiting in the wings.

Team management had said in recent days that the latter sponsor was set to come on board as soon as the Pro Continental licence was secured.

Today’s UCI communiqué expresses ‘deep disappointment’ at the situation and lays the blame firmly with team management. It argues that a successful application would have been in its interests. “The project of a professional Australian team was a new and very important step in the process of the globalisation of cycling which is a strategic priority of our Federation,” it stated. “A successful outcome of this initiative would have stimulated the pleasing growth phase that our sport is experiencing, notably with the creation and development of high-level races on different continents.”

However it said that while it regretted the failure of the team, that the UCI would not allow that affect the work it does nor the fact that other teams had followed their own obligations.

In terms of specifics, the UCI said that it is still waiting to hear the full details of why its auditors decided against the registration. However it said that the refusal was based on the financial aspect of the team’s registration, adding that “despite the extended deadline of 15th December that was exceptionally granted by the Licence Commission, Pegasus Sports did not provide either a bank guarantee or sufficient financial guarantees for 2011.”

Specifics of shortcomings:


The statement casts Pegasus Sports management – presumably CEO Chris White – in a negative light, saying that it was ‘rather unprofessional from the start.’ It said that it was informed on June 23rd of what the registration procedures were, but missed the initial deadline of October 1 for the initial registration requests. According to the UCI, this then meant that the riders who had been under contract for 2011 were entitled to walk away.

It added that a sporting evaluation of the team taken on October 20th had ranked it 23rd and outside the crucial top 20 places from which the final 18 ProTeams are determined. As a result of this, the team was instead considered for a Pro Continental licence;

That too was unsuccessful, as the UCI explained. “Given the shortcomings on the financial side, which could not guarantee that the team would survive the whole 2011 season, this option also had to be rejected.

“Following this decision and in line with the regulation, Pegasus Sports appealed to the Licence Commission, which took charge of the file. However, the team still did not change its attitude: it did not undertake the necessary steps to rectify the shortcomings regarding the UCI regulation, that were however indicated several times in the different reports established by the UCI’s auditors.”

Despite this, the UCI pointed out that it granted an extended deadline of December 10th to Pegasus Sports in order to give it time to sort out its issues, and indeed further extended this to December 15th.

Even with these concessions, it says the problems remained. “At the end of this ultimate chance, fundamental documents such as the bank guarantee and sufficient financial guarantees for 2011 are still missing from the Pegasus Sports file,” read the statement.

The UCI concluded by saying that it “can now only sincerely regret this conduct from the leaders of Pegasus Sports and express its sympathy to all the riders and others involved with the Australian team who unfortunately bear the consequences.”

That list of riders includes Svein Tuft and Dominique Cornu, who have new deals with Team SpiderTech and Topsport Vlaanderen-Mercator, as well as former Tour de France maillot vert Robbie McEwen. The latter is thought to have been in talks with Team RadioShack, and said on Twitter yesterday that he was not retiring.

He had floated that as a possibility after the Pro Continental application was rejected. The team had said that it would continue as a Continental squad, but today’s UCI release will further raise the concerns of its riders and staff and could drive others to jump ship.

Pegasus Sports has not yet responded to the UCI’s statement.

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