Inside the UCI’s blockbuster deal with Wanda Group
ADELAIDE, Australia (VN) — When China’s richest man comes calling with a deal in his pocket, you pay attention.
That’s what happened last summer, when Wang Jianlin reached out to the UCI with an intriguing offer. His Wanda Group wanted to create a new stage race in China. The UCI was all ears.
“They started talking to us in the middle of last year,” UCI president Brian Cookson told VeloNews. “We were very keen to see what they could come up with. They’ve been interested in coming into cycling for a while, and negotiations went smoothly. The deal was done shortly before Christmas.”
For Cookson and the UCI, the three-year deal with the Wanda Group is major coup.
Not only does the agreement mark a return of the WorldTour to the lucrative Chinese market, anchored by the six-stage Tour of Guangxi (October 19-24), it also aligns the cycling governing body with China’s richest man who is aggressively expanding his endurance sports portfolio.
The Wanda Group is rapidly becoming a major player in cycling. Takeover bids of the Tour de France and Giro d’Italia were discretely rejected last year, but that hasn’t stopped Jianlin. Wanda bought Infront Sports & Media in 2015 for $1 billion as well as the World Triathlon Corporation, taking over its Ironman triathlon series for $650 million. It also picked up the Cape Epic mountain bike event as well as part of the WorldTour Tour de Suisse and a marathon road cycling series called Velothon. In short, Wang is already a major player poised to get even bigger.
Good news for UCI
The Wanda deal is good news to the UCI, which is enthusiastic about the entrée of the Chinese magnate into cycling.
“Strategically, it makes sense in having another big player promoting major races. Monopolies are not a good thing,” Cookson said. “They are one of the biggest sports/entertainment companies in the world. They are huge. They are serious people and serious investors.”
This new deal is different than the UCI’s previous efforts in China with the Tour of Beijing. That race ran from 2011-14 under the UCI’s Global Cycling Promotions subsidiary, which Cookson closed following his election. Though that event had strong Chinese government backing, the race ran into blow-back over pollution worries and concerns about the appropriateness of the UCI owning and promoting races in a for-profit business.
Cookson said the UCI has no direct financial interest in the Wanda deal, and emphasized the UCI will receive only standard race fees and other administrative costs that go along with any WorldTour-level event.
“Our previous project in China with the Tour of Beijing was mixed success,” said Cookson, pointing out exceptions for the worlds and World Cups. “We scrapped Global Cycling Promotions because it is not our role to promote cycling events. Our job is to be a regulator. There are racing fees, but the whole idea is that they’re investing in China through their event. There is a WorldTour fee, but that is all the UCI gets out of this.”
Goes beyond WorldTour
Cookson said they pushed that the deal reach beyond the WorldTour race. It also includes a satellite office of the UCI’s World Cycling Center, accompanying public rides and a women’s race as well as playing the host to UCI events like the newly minted urban cycling world championships.
“When we started to talk, we really wanted to help the Chinese cycling federation. We don’t just want a big race; we want to help cycling develop. We wanted some mass participation events, and to encourage the local government to invest in cycling infrastructure,” Cookson said. “They wanted to be part of the WorldTour. Because we were assured of their level of investment and commitment, it seemed like an extremely good deal.”
Following the initial contact last summer, things moved quickly. Wanda made a formal presentation to UCI officials during the Doha worlds, and the details were hammered out in the next few weeks. Chinese appliance company Gree, the world’s largest producer of air-conditioners with more than $20 billion in annual sales, has already signed on as race sponsor.
“Wanda are determined to do things in a big way, and we want to work with them as a partner,” Cookson said. “This will be nothing like Beijing In terms of environmental issues, and they want people to watch it, so they are going to promote it. It will not be like Qatar or Beijing, remarkable by the absence of fans.”