Team NZ solution hinges on price tag

By JAMES GARDINER

Talks between the old and new guard in the America's Cup defence were delicately poised last night, with the dispute hanging on the multimillion-dollar price for Team New Zealand boats and assets.

Sponsors were eagerly awaiting developments, saying they wanted to continue their involvement but that would be subject to negotiations.

Insiders expressed confidence a deal would be done that would give most of about 85 existing employees of Team New Zealand Ltd certainty about their future with the syndicate.

Brad Butterworth, who with skipper Russell Coutts and Tom Schnackenberg heads the new management team, has told the Herald he and other employees of Team NZ had had other job offers.

Sources suggested the sellers, who have contractual rights to defend the cup on behalf of the Royal New Zealand Yacht Squadron, value their boats, compound and goodwill at $12 million or more.

The issue appears to be how much, if any, of that the buyers are prepared and able to pay. Squadron vice-commodore Peter Taylor said yesterday that his organisation strongly supported the move to hand over leadership. "We'll do everything we can to ensure that that's a smooth transition."

Rumours that the Prada syndicate had bought the New York syndicate's two boats for $US6 million ($12.2 million) were cited by one key player as evidence that the black boats had to be worth at least that.

Telecom, one of the main sponsors, was "certainly interested in continuing our relationship with the new management," said communications manager Glen Sowry.

Spokesmen for Steinlager and TVNZ said they, too, were keen to stay on board. Lotto and Toyota management could not be contacted but are believed to remain firmly committed.

AC2000 Ltd, which organised the finals regatta, is wholly owned by Team New Zealand Ltd, which in turn is wholly owned by Team New Zealand Trustee Ltd. That company is a private charitable trust, incorporated in May 1993, with its registered office at the Shortland St chambers of law firm Russell McVeagh McKenzie Bartleet & Co.

The trust deed is not a public document, according to John Lusk, one of the shareholders, directors and trustees. He said it satisfied Inland Revenue Department requirements for a charitable trust for tax purposes.

"Any surplus after the finalisation of the affairs belongs to the charitable trust and must go to charity," Mr Lusk said. Then the three companies would be wound up.

The new entity has not revealed its name or structure but it is expected to involve a new charitable trust with new trustees.

The Coutts-Butterworth group would replace the current leadership of syndicate head Sir Peter Blake and executive directors Alan Sefton and Scott Chapman.