The NZ Government has announced that it will provide Team New Zealand with $5million of interim funding to allow the team to retain key members ahead of the 35th America's Cup.
The funding comes before the team has made a decision whether or not to Challenge for the trophy it failed to win by an 8-9 margin last month in San Francisco.
The amount provided is half that provided in 2010 - but that was covered by an agreement signed between the Team and the previous Labour government.
The announcement was made by the Economic Development Minister Steven Joyce, who is the Minister responsible for New Zealand Trade and Enterprise, who were a key sponsor of the team in the 32nd and 34th America's Cups, and use the opportunity to leverage trade opportunities for New Zealand industry into key markets.
A study of the benefits of the investment for the previous America's Cup is expected to reveal a tenfold return on the investment of $36million plus a further $4million (all NZD) investment to leverage business opportunities in North America.
Joyce has previously said that any investment by the Government on behalf of NZTE would be on the basis that the Team could raise a similar amount, ahead of any Challenge being lodged.
In the previous cycle $10million was given on a similar basis to the $5million announced today. The balance was tagged on the basis that it had to be matched on a 2:1 basis with other sponsorship arranged by the Team. If the team does not challenge, in the past there there is no payback requirement - other than unspent money from the Government contribution.
Joyce said planning was now underway for the next challenge. 'However it will not be possible for them to finalise their involvement until such time as they know key elements of the regatta, including where and when it will be held,' he said.
'The Government will assess its further involvement based on a strong business case from the team, and the benefits our involvement would bring for New Zealand exporters and our New Zealand brand.'
The deadline for a decision whether or not to Challenge is believed to be May 2014, with the Government study into the economic return being completed by March 2014. The amount of the America's Cup investment in the 2010-2013 campaign, is relatively small compared to the incentives given to the film industry for the making of the Lord of the Rings and The Hobbitt movies in New Zealand.
Key criteria hedging the decision whether or not to Challenge are believed to be a nationality clause on sailing crew composition; realistic cost of a Challenge; a logistically more feasible boat; as well as venue and dates.
Steven Joyce confirmed that the team had initially asked for $6.5million with the additional sum being for technology research. The team had agreed to try and fund that amount from other sources. Joyce confirmed that if the Team decided not to proceed with a Challenge in May, then the investment will be written off.
First time challenger, Hamilton Island Yacht Club, Australia, was accepted as the Challenger of Record by the Defender Golden Gate Yacht Club.
The Protocol negotiated between the two Clubs is expected to be announced in February 2014, after which entries will open to other Clubs to lodge a Challenge.
Click here for the TVNZ news report of the funding injection. And click here for the TV3 report on the announcement.
Team New Zealand first Challenged for the America's Cup in 1987, reaching the Finals of the Louis Vuitton Cup. It won and Defended the 160 year old trophy in 1995 and 2000. Each America's Cup cycle the team has reached the Louis Vuitton Cup Finals, and has been the Challenger in 1988, 2007 and 2013. In 2011/12 the Team entered the Volvo Ocean Race, placing second overall in Camper. In 1987 and since 1995 the Team has represented the Royal New Zealand Yacht Squadron.
by Richard Gladwell
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4:40 AM Mon 21 Oct 2013GMT
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