KZBlog

Following up on my earlier post about Team Astana’s financial problems, I see that ESPN is reporting that Lance Armstrong’s team may be suspended if they do not meet their financial obligations by the 31 May of this year.

Team Astana is funded primarily by state-owned companies under the national holding company, Samruk-Kazyna. However recently in reaction to the financial crisis, the holding company has cut staff and salaries both in its own staff and for the companies under it. It seems unlikely that they will be able to fund the cycling team. Or that given that Samruk-Kazyna is spending money to bail-out banks and other financial companies, there are other organizations that need the money more than Team Astana.

Regular staff of the team have not been receiving salaries and the team was sent a letter by the International Cycling Union stating that if they do not meet financial obligations by the end of this month, they will be suspended from the UCI. In other words, the team will not be able to compete in races.

Lance Armstrong has reluctantly spoken to reporters about the issue although he seems to prefer to keep silent since he is not involved in the day-to-day business of the team. The AP article states:

Armstrong indicated last week that he was talking to U.S.-based sponsors about taking over the team himself. That might be his only solution if he wants to go for an eighth Tour de France title in July.
“I’ve already said all I know about Kazakhstan, Astana, Borat. I don’t know anything more,” Armstrong said when last asked about the issue. “It’s not my team, it’s not my sponsor. I’ve got nothing to say about it. I would love to give you an answer, but I don’t have one. I would be speculating.
“It’s difficult to go to any major corporation and say in the middle of the calendar year — the fiscal year — and say, ‘How about we start in 20 or 30 days?’ But we’ll see.”

However the world’s most famous cyclist did seem to have some frustrations, as he told ESPN:

“I don’t know [the Kazakhstani officials], I don’t have a personal relationship with them, but I get frustrated,” said the seven-time Tour de France champion who’s riding for free this season. “These Kazakhs, they don’t return phone calls, and there’s not a lot of clarity about what is going to happen.

Sponsoring a team requires US$14-20 million a year, according to Mr. Armstrong so it is unlikely that another sponsor will be able to jump in by June to save the team. There is speculation that Armstrong’s fund may be able to assist, but as a charitable non-profit it probably could not assume full management of the team. However the team will be able to finish the Giro d’Italia which it is currently racing in.

Kazakhstan news sources seem to be fairly quiet about this preferring to focus on the fact that Team Astana is currently in third place in Italy.