WorldTour or bust: new team, same aim for LTdL

Ciclista Sports was announced as the new organiser of Le Tour de Langkawi last month, becoming the fourth private operator to oversee the big-budget event in its 20-year history. Ciclista CEO Emir Abdul Jalal brings with him some new ideas but, as Cycling iQ discovers, some ambitions never change.

A stage win at Le Tour de Langkawi can hasten the rise to the top tier of professional cycling, as proved by Andrea Guardini (racing for Farnese Vini-Neri-Sottoli) after his six stage wins in 2012.

Malaysia s biggest stage race isn t the only 2.HC event in Asia, but it has become something of a regional poster child for the UCI AsiaTour. Race organisers from Korea, Taiwan and China have all dispatched departmental staff to Le Tour de Langkawi (LTdL) in recent years, in most cases so they can develop the information and competencies required to elevate their own status, attract all-important WorldTeams and increase the prospect of international broadcasts. This cultural exchange also extends to LTdL personnel being engaged by those same organizers to oversee important elements during the running of their own events.

Indeed, LTdL s success as a stage race has much to do with superior organization, but below the surface lies the same inherit threats faced by its 2.HC peers (although to varying degrees); the unpredictable nature of commercial and government funding.

When in 1995, then-Prime Minister Mathahir Mohamad floated the idea of an international cycling event in his country, Berjaya Group Berhad a growing conglomerate[1] engaged in property development, gambling, hotels and resorts took up the challenge. First Cartel Sdn Bhd, a sports events organiser and 70%-owned subsidiary of Berjaya Group[2], engaged events company IMG to provide support for the inaugural edition, which covered 1 300 kilometers over 11 stages and was budgeted at RM9.1m. Marketing objectives dictated the resort island of Langkawi, from which the race gets its name, hosted the opening and closing stages so the Group s flagship Berjaya Langkawi Beach & Spa Resort[3] could be used to host teams and feature extensively in media coverage. Little consideration was given to the complex logistics of transferring teams and equipment off the island and back on again ten days later.

After flying totally blind [4] in 1996, First Cartel recruited experienced Brit and former PR man Alan Rushton[5] the following year to oversee LTdL as Race Controller. This arrangement remained in place until 2004 when First Cartel founder and CEO Datuk Wan Lokman[6] sold the company to Simon Donnellan[7], who ran the race in 2005 and 2006. Though the business of racing continued as usual, several teams and suppliers began speaking publicly about unpaid prize monies and bills from the 2005 race. When the full extent of the problem was revealed, First Cartel was wound up in the Kuala Lumpur High Court. With no organiser and loathe to see another scandal repeated, Malaysia s sports ministry intervened with a RM10.7 million bailout to ensure the race could be held in 2007, handing organisational responsibility to the Malaysian National Cycling Federation (MNCF).[8] LTdL remained fully funded by the Malaysian Government through to 2011, after which a diminishing grant strategy was implemented to ensure commercial sponsorship would contribute up to 50% of the event costs.

In November 2014, the Ministry of Youth and Sports announced the race organisation would be handed back to the private sector. Human Voyage Sdn Bhd, an experienced events company that also ran the Langkawi International Mountain Bike Challenge (LIMBC), had only three months to prepare for the 08 March start date of the 2015 edition. The terms of the two-year contract, which would run through to the end of the 2016 race, guaranteed a RM10m grant from the ministry. Ultimately, only one year was required for Human Voyage CEO Datuk Malik Mydin to determine that it wasn t worth the financial headache, and his company announced it was withdrawing from the contract in October 2015.

Emir Abdul Jalal pictured with David Zabriskie before stage 2 of LTdL 2012

It seems elementary that a history like that, which hides in plain sight across virtual reams of online documentation, might scare off potential suitors. But Ciclista Sports Emir Abdul Jalal couldn t wait to get started on a bid once the Ministry called for tenders.

The process started just after the previous organiser, Human Voyage, announced they didn t want to continue (organising) the race for 2016, recounts Emir from his office in Shah Alam, a half-hour drive west of Malaysia s capital Kuala Lumpur. So we went in, I think in October, and the process took about one month the normal procedural time for Government bidding. About seven companies went in, a shortlist was made, we were appointed in early November and the announcement was made on 12 November 2015.

To understand Emir s interest in bidding, it helps to understand his own history with one of Malaysia s most famous sporting events.

I started being involved in LTdL from 1997 actually, then I stopped in 2000 to join mainstream politics. I organised Jelajah Malaysia in 2007 and 2009 under a private company (Ten Speed ??Sdn Bhd, owned by Datuk Astaman Abdul Aziz) and it was a major success in those years. I was appointed as a consultant to LTDL in 2010, became the Operations Director of Events in 2011 and was COO from 2012 2014.

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Emir had previously sought to organise LTdL when The Ministry of Youth and Sports turned to the private sector in late 2014, but he was nudged out by Human Voyage. When I lost the tender to Human Voyage, they took most of my staff to help run the 2015 race, he states matter-of-factly, before adding but I think they failed somewhere, which was the major cause why they didn t want to continue the race.

Ciclista Sports LTDL contract is for two years, after which there will be an evaluation by the Ministry. If everything goes smoothly in 2016 and 2017, the contract contains an automatic one-year extension. The company is an entity of cycling sports apparel brand Ciclista, the official apparel supplier to LTdL since 2013.

When I lost my bid for LTdL in 2014, Ciclista brought me to the company as a director. We continued to offer cycling sports apparel plus other sports and corporate apparel. We also organise and supply small events in Malaysia, including racing and leisure. Ciclista Sports was established before we put in the 2016 bid and I put all my LTdL experience into the company.

Emir admits Ciclista Sports has a critically short timeframe of three months to organise next years race, beginning 20 February 2016. Malaysian Government Minister for Youth and Sports, Khairy Jamaluddin has slightly increased Government funding to RM11[9] for the 2016 edition (up from RM10 in 2015), but has been quoted by the New Straits Times as saying the Government is looking at (LTdL) to eventually be fully funded through corporate sponsorship . However, Ciclista Sports will have at least the current level of Government funding over the next two years.

The Government already told us, over this 2-3 year contract period, that they will maintain the grant given. Of course, they will contribute less and less after the contract. It has always been the focus of the Ministry to cut the debt for organising international events. During my time as COO, LTdL was given RM16m by the government, and we were running at a total cost of RM19m for the race. Peak cost, which I think was in 2007, was RM24m. I ve budgeted the 2016 event at RM16m, so it has already been a tough time for anyone wanting to organise an international event. The economy is not that good for commercial sponsorship, but we are trying hard. Finding RM5m is a lot easier than finding RM20 at the moment. If the economy comes right and companies start spending on sponsorship then we ll definitely give option to the Government to lessen the burden by reducing our grant and in 3-4 years time we can find money on our own. That is the whole idea.

Of course, in order to attract corporate sponsors it is necessary to field international teams that will attract maximum international media interest while still ensuring Malaysians are not forgotten. UCI regulations state that up to half of all teams participating in a UCI AsiaTour 2.HC event can be at WorldTeam level. 22 teams will be invited to race LTdL next year, which means that 11 of those teams will be UCI Continental level. The remaining 11 spots will be a combination of WorldTeam and Pro Continental teams.

The key sporting index in the race is to improve on what we have done in 2014, where we had six WorldTeams and five Pro Continental teams. The number one objective is get more WorldTeams, which is a particular department that I m taking care of. The main event KPI is to see how far we broadcast ourselves so I ve also contacted Eurosports, which was the previous broadcaster of LTdL in 2014, and Fox Sports has also come to our company offering a lot of things. (Human Voyages) scrapped most of my promotional programs in 2015, so I have to get everything back to make sure that the public in Malaysia can also get more involved in the promotion activities at LTdL that s the other important side to the race.

Meeting these objectives will not come cheap. The Malaysian Ringit is currently trading at 23.5 US cents, roughly 30% lower than when LTdL was held in 2014, though Emir insists this will have no impact on the prize money, which is paid in USD. A national 6% Goods and Services Tax (GST) has also been implemented since last year s race, adding to the race s overall costs. Ciclista Sports is hoping to tap on the shoulder of previous sponsors to bridge the RM5m gap between Government funding and organisational costs.

We are first looking at cost deduction strategies such as lending cars from Proton. We would have to spend RM1m for rental cars otherwise. We also need to involve petrol companies like Petronas, Petron, BHP and other companies to help us reduce overhead costs. In terms of title sponsorship, that is a bit tougher. Last time we had Telecom Malaysia. They spent RM16 to be the title sponsor of LTdL in 2000 and 2001. First Cartel got that money quite easily in that time. We re trying to get companies like that involved again in 2016, but at the moment we are still looking.

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Some cash expenses are unavoidable though, including the expense of flying in first-division cycling teams. The minimum appearance fee is USD30 000, not including airfares and excess baggage, which on its own can absorb several thousand dollars. According to Emir, LTdL paid USD50 000 to host ORICA-GreenEDGE in 2014, though Belkin-Pro Cycling and Katusha received only the USD30 000 appearance fee, funding their own travel to the race. They asked us to spend less because they just wanted to come here for the sake of riding LTdL, states Emir. LTdL gives them much more than money. It s the services here, the people here. Some things are just priceless.

One of the first problems Ciclista Sports inherited was the 06-13 March calendar slot that existed before they were handed the keys to the race. They swiftly sent letters to all previously invited teams informing them the race dates would be changed to 20-27 February. Ostensibly, this change was made to avoid a clash with Tour de Taiwan (06-10 March), but it was actually the timing of WorldTour events Paris-Nice (06-13 Mar) and Tirreno-Adriatico (09-15 March), that necessitated the adjustment. A meeting was also held with the organisers of Tour de Sarawak, a new UCI2.2 Malaysia stage race originally scheduled for 24-28 February 2016, to ensure they wouldn t be impacted. They agreed to reschedule to 03-06 March.

For us to get WorldTeams within that time (06-13 March) would have been really, really, tough, explains Emir. The change to 20-27 February means we only clash with Tour of Oman (16-21 February), which is run by ASO. Tour of Oman involves a maximum of 10 WorldTeams so that leaves at least eight (WorldTeams) free to race elsewhere. All other UCI races in late February are not in the WorldTour category so it becomes a negotiation with the teams, rather than competing with the other WorldTour races. Furthermore, at Tour of Oman, which is also not a hilly race like ours, there is a maximum of 8 riders per team so that leaves more riders per team to compete somewhere else in the world. If there are enough riders in Oman and Malaysia at the same time, there are more opportunities to get more WorldTeams here. If we can get ten WorldTeams, we will just invite one Pro Continental team. That s the mathematical side of the invitations.

Though high-profile WorldTeams, such as Team Giant-Alpecin and Lampre-Merida Giant-Alpecin, have adopted something of a Asia pivot by recruiting Asian riders, Emir concedes that LTdL, as Asia s most important professional stage race, doesn t have the time or negotiating power to target such teams.

It doesn t mean we don t care about which team comes. At the moment our main focus is to get as many WorldTeams as possible, because it s very important for the visibility of the event in Malaysia. To get WT teams with Asian riders is always a bonus but I already set a system whereby the 11 Continental Teams are all from Asia. There is always a fight for these places. Many teams from the UK and Europe have asked so many times but we have a commitment to give more opportunity to Asian teams in the Continental and National team categories. That s why you see Asian teams fight extremely hard in the race because they know they are racing against the world s best teams.

Naturally, the easiest way to attract more WorldTeams is to become a WorldTour event. Prior to the UCI s decision to establish a WorldTour race in Beijing in 2011, LTdL was touted as the AsiaTour race most likely to meet the criteria to be upgraded from 2.HC to World Tour status. Snippets of high-level discussions concerning the details of such a plan have floated in and out of media for at least the last decade.

In 2011, there were actually Ministry-level talks about when the LTdL should be upgraded to a WorldTour event. According to the plan, I made a 3-5 year outline to upgrade LTdL to that level. People just can t understand how much is spent. For a LTdL at WorldTour level I already put the budget at RM30-40m to the Ministry. The financial part could be negotiated, but then the other issue was if we organize LTdL how will the Malaysian riders have the opportunity to ride? . That s the major issue because, at the time, Terengganu Cycling Team had only started and they also had great potential in the AsiaTour. I spoke with the team manager and they were eyeing Pro Continental status over a few years time; meaning if LTdL wanted to upgrade, then at least Terengganu were also taking the challenge to get Pro Continental status. They were in the process of planning the challenge. That would have been the right time to do something. Of course, I was dropped from LTdL in 2015 so the whole idea has to be re-established. Now, I m talking with the Government on whether or not we are targeting to have a WorldTour race so I can plan for another 1-2 years time. But the key issue apart from finances is whether a local team can get Pro Continental status. If they do, then that concludes the whole logic of the system. If I have a WorldTour race here but local riders can t compete then it s only a show here in Malaysia and nothing to do with development. Right now, it s not economically or developmentally viable to have a WorldTour event.

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Viability is a sensitive word at a time when other UCI AsiaTour races in Malaysia live a tenuous existence. Jelajah Malaysia, the race which Emir organized until MNCF took it over in 2009, has faced several postponements in recent years and was close to not running this year before being thrown a lifeline by a private company run by former Malaysian pro cyclist Musairi Musa. The Melaka Governor s Cup was also twice cancelled in its short history due to funding shortages. Though related only to LTdL by way of their MNCF connection, the entire racing ecosystem is a major consideration of any future WorldTour bid.

During our (tender) presentation, we said LTdL must be promoted to WorldTeam level in three years time, for the evolution of cycling in Asia. But at the same time I told them that if we want to upgrade to a WorldTeam level, then one of the UCI2.2 races in Malaysia whether Tour of Borneo, Jelajah Malaysia or any of the other new races coming next year must also be upgraded to the Hors Categorie level that LTdL has now, so the whole system is complementary. At the moment I see the current financing of events in Malaysia is still slow at the moment, maybe because the other events are not (politically) influential enough. Being experienced enough in race organisation, I think Government needs to give priority to them, give them some funds to start up the event, which also gives them some options; rather than organise on their own, find it too tough, then not have enough money to manage a good race. Last time I managed Jelajah Malaysia it was just lucky that I had corporate sponsorship. Because the (race) organization was good, we had the confidence of the commercial sector. The budget of Jelajah Malaysia was only 10% of LTdL s so it was also easier to find the money. I managed that race for RM2m and it was good to have such a popular UCI2.2 event that teams in Asia looked forward to going to at that time.

These smaller events really help the development of cycling in Malaysia, especially in getting riders to win stages. That s what the other nations are doing. They get more (UCI) points if they can race in their own country, so they get more opportunity to compete in the World Championships or Olympics. Having UCI2.2 races is the best option for more riders to compete, to gain experience at the international level. That s why I already advised the Government that those events in future must be kept and protected in Malaysia every year. But because the events are run by private companies, we cannot control the standard of the organisation.

Emir confirmed that Ciclista Sports is still in the middle of negotiations to secure teams for the 2016 race, and it is expected that announcements will be made early next year. Cycling iQ will have a full race preview when more details are announced.

[1] in 2015, operating as Berjaya Corp. [Interesting side note: founded by Tan Sri Dato Seri Vincent Tan Chee Yioun (Vincent Tan), a self-made Malaysian businessman. Berhard Group evolved from Tan s 1984 acquisition of a major controlling stake in Berjaya Industrial Berhad, which in 1988 became a subsidiary under another Tan acquisition, Inter-Pacific Industrial Group Berhad. The latter was first incorporated in 1967 as Raleigh Berhad, a bicycle manufacturing company. Prior to 1984, amongst other commercial successes, Tan had opened Malaysia s first McDonald s franchise in 29 May 1982. Eagle-eyed readers may notice a reference to this in the feature image ]
[2] First Cartel Sdn Bhd was 70% owned by Inter-Pacific Communications Sdn Bhd, an advertising and PR firm owned 100% by Berhard Group. Inter-Pacific s stake in First Cartel diminished to 40% in 1998, before being fully spun-off in 2001.
[3] in 2015, operating as Berjaya Langkawi Resort
[4] First Cartel CEO Wan Lokam, speaking to the New Straits Times, 07 January 2000
[5] Managing Director of UK-based Sport for Television
[6] Wan Lokam created First Cartel in 1995 specifically for the purpose of running Le Tour de Langkawi. His brother Datuk Wan Adli was a high-profile Berjaya Group executive throughout the period in which First Cartel was a subsidiary of the Group.
[7] see the Loose ends from Langkawi Cyclingnews article, written by Anthony Tan, for an interesting backgrounder on Simon Donnellan
[8] from 2009 until 2014, the National Sports Council (NSC) jointly supported MNCF in organising LTdL
[9] at time of writing MYR1 = USD0.235

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