the initial cost of buying out/bailing out le tour deal is pretty low... but, am sure there are huge money to be spent in the coming years as to 'maintaining' this event...
also, as reported... "Azalina said that to avoid suspension of its membership or the loss of rights to host the cycling tournament, the ministry had in principle agreed to settle the RM2.3mil demanded by UCI.
She said the Tourism Ministry had agreed to settle the cost for hotel lodging amounting to RM1.15mil."...
if paying approx rm 3.5m which the organiser owe to various parties is not define as bailout, then i think she must define and allow us to know the real meaning of bailout to the rakyat tho...
Azalina explains Le Tour deal as buyout, not bailout
THE Government had decided to take over the annual Le Tour de Langkawi cycling event from next year as the current host, First Cartel Sdn Bhd, is facing financial troubles and is unable to hold the race next year.
Youth and Sports Minister Datuk Azalina Othman said the government move would ensure that the event continues to be held during Visit Malaysia Year 2007.
“If the Government does not do this, Malaysia will be unable to host Le Tour de Langkawi next year,” she told Datuk Astaman Abdul Aziz (BN – Titiwangsa).
She said Le Tour de Langkawi was one of the five most-prestigious cycling events in the world, recognised by the Union Cycliste Internationale (UCI).
The others were the Tour de France, Giro de Italia, Tour of Spain and Tour of Great Britain.
Le Tour de Langkawi is also the biggest cycling event in Asia.
Azalina said First Cartel, which had been organising the tour for the past 10 years, had debts totalling RM10.2mil due to lack of sponsorship.
Of this, RM2.3mil involved cyclists’ cash rewards and television-related creditors.
She said UCI had issued a warning to the Malaysian Cycling Federation to rectify the situation following complaints by cyclists and broadcasting companies who were yet to receive payment.
“If UCI takes action against the federation and First Cartel, it could tarnish the image of the country and affect cycling here,” she said.
“After a series of discussions with the relevant parties, the Government decided to take over Le Tour de Langkawi from 2007.
Azalina said that to avoid suspension of its membership or the loss of rights to host the cycling tournament, the ministry had in principle agreed to settle the RM2.3mil demanded by UCI.
She said the Tourism Ministry had agreed to settle the cost for hotel lodging amounting to RM1.15mil.
Azalina said the payment was not a “bailout” but more of a “buyout” of the Le tour de Langkawi trademark to ensure that the Government or any organisation appointed by the Government could continue to have the rights to host the event.
She said UCI had also imposed a ruling to ensure that technical expertise from First Cartel be maintained under the new management.
To avoid a recurrence of similar problems, the ministry and the Tourism Ministry had formed a joint taskforce for international tourism sports, to study applications submitted by associations, organisations or the private sector, Azalina added.
Government’s RM 3.5 Million Bailout Of Le Tour de Langkawi (LTdL) Is Irresponsible And Against National Interest As More Millions Of Ringgit Will Have To Be Spent In Future And No Action is Taken Against The Failed Organiser.
by Lim Guan Eng
(Petaling Jaya, Wednesday): DAP opposes the government’s RM 3.5 million bailout of LTdL as an irresponsible act that is against the national interest as many more millions of ringgit will have to be spent in future and no action taken against both the failed organizer, First Cartel Sdn Bhd, and sports officials involved. Youth and Sports Minister Datuk Azalina Othman Said had announced in Parliament on 22.8.2006 that,
"The total cost to be borne by the government to take over as organiser of the LTdL is RM3,458,844.35 and this is not to bail out First Cartel Sdn Bhd. Her Ministry had agreed to settle an outstanding debt of RM2,307,909.09 claimed by International Cycling Union (UCI), that is, RM1,056,238.25 owed to the cycling related creditors and RM1,251,670.84 to television related creditors while the Tourism Ministry would fork out RM1,150,935.26 to settle outstanding debts on hotel bills.”
The immediate question that comes to mind is whether the government has so much money that it can not find a better use for RM 3.5 million than to bail out a failed cycling event that provides minimal value for improvement of Malaysian sports. Just like the waste of building the proposed High-Performance Training Centre in London expected to cost hundreds of millions of ringgit, the money spent on bailing out LTdL and organizing it should be spent on developing Malaysian cyclists and athletes.
If paying the RM 3.5 million bills owed by the failed organizer, including hotel bills, is not a bailout then how does the government define a bailout? The government and Datuk Azalina are in a state of complete denial that the LTdL has failed and the government is undertaking a massive bailout to keep it afloat. Worse, no action is taken against those responsible for this failure that has tarnished the international reputation and sporting image of the country and Malaysian sports in general. What happened to transparency and accountability promoted by Datuk Azalina in Malaysian sports?
This sends out a wrong message contrary to the core of the Abdullah administration in promising to root out corruption and stopping the use of public money to bail out failed private ventures. Other private enterprises will be expecting similar bailouts and such unhealthy practices will not encourage fostering a first-class mentality that is independent and competitive. Further Datuk Azalina must explain how the government can do better when a private enterprise can not cope despite obtaining full government and private sector sponsorship such as Telekom.
Malaysian Grand Prix Has Michael Schumacher and Fernando Alonso But Has The LTdL Any Lance Armstrong Or Top Cyclists?
From an initial cost of RM 9 million in its inception in 1996, the cost of LTdL has ballooned to more than RM 22 million. The cost will only increase in future and it is irresponsible for the government to spend tens of millions of ringgit for the LTdl that has doubtful value and returns?
Datuk Azalina must not forget that unlike the F1 racing event, the LTdL does not attract top-class cyclists. Despite the massive outlay, the Malaysian F1 can boast the presence of all the top F1 stars, such as the greatest F1 driver in history Michael Schumacher and current world champion Fernando Alonso, racing the Malaysian Grand Prix boosted by a strong world-wide television audience. Can the LTdL boast the same international presence such as top cyclists like Lance Armstrong or world-wide television coverage?
Clearly the present administration is continuing with the old paradigm of bailouts without any action against those responsible and using the public money to keep failed ventures alive. DAP dreads to think how much more public money would be lost before the government comes to its senses by abandoning such schemes and stop the wastage of public.
Instead of accountability and transparency, DAP regrets that the youngest and newest Cabinet Minister in Datuk Azalina is continuing the discredited policies of bailouts. MCA Youth President Datuk Liow Tiong Lai is also a massive disappointment in failing to match his rhetoric of good governance with his performance as Deputy Minister of Youth and Sports.
DAP urges the government to have the courage to let the LTdL fail as a lesson to sports administrators and private enterprises that they have to pay the price of the failures. The government should not be afraid of being excluded from the UCI, if sports officials can wake up to the new paradigm that they have to be accountable for their failures. Better to bear the short pain now of cutting your losses immediately than sustain long-term pain of bailouts without end.
perhaps another feather to azalina's hat?!?... her ministry watttttttttt...
as reported... "She said First Cartel, which had been organising the tour for the past 10 years, had debts of RM10.2mil due to the lack of sponsorship."...
if you know very well you are making heavy losses in yr biz but still doing it... why?!?... something under the carpet?!?... something in the closet?!?...
wait... when one is able to prob further into this matter... their answer COULD BE 9 years profit, but the 10th year we suffered a lost of rm 10 over million.... that's why we can proceed with this event anymore... a possible scenario?!?...
so, meaning the bottom line will be the government gonna pay a whooping rm 10.2 million to offset the debt?!?...
Le Tour de Langkawi will go on
KUALA LUMPUR: Asia's premier cycling event, the 10-yearold Le Tour de Langkawi, will go on, said Tourism Minister Datuk Seri Tengku Adnan Tengku Mansor.
Tengku Adnan, in dismissing rumours that the annual cycling event would be scrapped next year due to financial problems faced by the organiser, said: “We will resolve the problem. Le Tour de Langkawi will still be on next year.
“Rumours say that we are going to scrap the event. No, we are not.
“We are looking at taking over the franchise. We are only paying whatever debts owing, especially the prize money and hotel bills.”
Tengku Adnan was speaking to reporters after launching the 3P (Program Pelancongan Pelajar) Carnival at the Malaysia Tourism Centre here.
The Government wants to take over the franchise from First Cartel Sdn Bhd which is said to be facing financial difficulty and unable to hold the race next year.
Youth and Sports Minister Datuk Azalina Othman had said that the move – described as a “buyout” instead of a “bailout” of the Le Tour de Langkawi trademark – would ensure that the event be held during Visit Malaysia Year 2007.
She said First Cartel, which had been organising the tour for the past 10 years, had debts of RM10.2mil due to the lack of sponsorship.
Of this, RM2.3mil involved cyclists’ cash rewards and television-related creditors.
Tengku Adnan said the Government realised that certain event organisers had been asking money from a few ministries.
But they lacked accountability and did not settle their debts, he said.
In view of this, the two ministries would set up a committee to look into problems related to the hosting of international sporting events.