Team Ineos sponsor's venture seeking up to £500 million in state support
Falling oil prices lead British billionaire-owned firm to ask for emergency loans
The economic effects of the COVID-19 coronavirus pandemic have bubbled up to the highest levels of cycling, with a side venture part-owned by Team Ineos' main sponsor, Sir Jim Ratcliffe – one of Britain's wealthiest people – appealing for hundreds of millions of pounds of emergency government loans.
According to Sky News, Petroineos, jointly owned by the Ineos Group that sponsors Team Ineos and the state-owned Chinese firm PetroChina, are negotiating with the UK and Scottish governments to secure a huge loan package that could be as large as £500 million after oil prices dropped from a high of over £50 per barrel in December to just over £15 per barrel last month.
Ratcliffe stepped in to sponsor the team of Tour de France winners Egan Bernal, Geraint Thomas and Chris Froome after the exit of Sky in May 2019.
In April, when asked about the financial security of his team's sponsor, Team Ineos principal David Brailsford dodged the question, saying only, "Some teams may suffer slightly more than others; depending on what business sector their main sponsor is in."
Team Ineos' annual budget is estimated to be over £40 million and the highest in the sport.
The move by Petroineos to seek emergency loans echoes that of CCC, owned by billionaire Dariusz Milek. The Polish shoe company, in negotiating with banks to secure financing for the next 12 months, will at the end of the season cease sponsorship of the eponynous WorldTour team.
The CCC Team cut its riders' salaries in half and laid off all but a few staff to keep afloat for the rest of the year, while other teams such as Astana, Lotto Soudal, Bahrain Merida and Mitchelton-Scott have also trimmed salaries.
Astana, also reliant on the oil industry, say they won't survive if racing doesn't resume, while Bigla-Katusha have resorted to using the UCI bank guarantee to pay its riders after its sponsors abruptly withdrew funding.
UCI President David Lappartient acknowledged the severity of the problem in a sponsorship-driven sport.
"We know that three, four, five teams have more problems than other teams," said Lappartient. "We hope they all reach the end of the season."
But the UCI, which has suffered its own cost-cutting measures, having to furlough 130 staff, is not equipped to come to the rescue.
"Our union is going through a crisis that we have not known since World War II," Lappartient said.
"Unfortunately we're not a bank: we've only got €600,000. We're hard on the calendar so that we can put on the races. It's the only way to give some oxygen to the teams."
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