Mitchelton-Scott have informed Velon, the business group that represents several major WorldTour teams, that they will no longer invest in the company and have started proceedings to remove their shares from the group.
The news means that the entity founded in 2014 to help promote teams and generate new revenue streams via rider data, video content and race participation fees, as well as races such as the troubled Hammer Series, has lost vital backing from one of their founding partners.
Velon was created in 2014 as the leading teams became more and more frustrated about the business model of professional cycling. Velon includes 10 of the leading WorldTour teams: Bora-Hansgrohe, CCC Team, Deceuninck–QuickStep, EF Education First, Lotto Soudal, Team Ineos, Team Jumbo-Visma, Team Sunweb, Trek-Segafredo and UAE Team Emirates.
"Since the change of management this year we have reviewed all of our contracts. Being shareholders of Velon is one of our contracts and a decision was made to step down as shareholders. However as a team we are more than happy to support various projects which Velon invest in," Mitchelton-Scott's general manager Brent Copeland told Cyclingnews.
The wheels for Mitchelton's departure were set in motion back in October when the Australian team initially told Velon that their investment would cease during a meeting that took place at the Giro d'Italia.
At the time, Velon denied to Cyclingnews that Mitchelton-Scott were set to leave, with Velon CEO Graham Bartlett stating that "because Mitchelton-Scott are changing their paying agent someone has said that they're reviewing everything and that includes us. They are doing a review process that includes Velon. That's where someone has got the idea that someone is leaving Velon but they're not. Their commitment to Velon is being reviewed and how it works going forward with the new paying agent. As we did in the past with EF. They did the same thing.
"As far as I know there's no team that's leaving Velon. I'm not aware of any team that's leaving their obligations at Velon."
Two months on, however, Mitchelton-Scott have confirmed that notice was given during the Giro and that while they will support Velon projects in the future, they will no longer invest or seek to benefit from the group's revenues.
The original aim of the Velon group was to establish new commercial revenue streams for the teams to reduce their dependency on sponsorship. However, they have struggled to meet those demands as they fought aggressively with the UCI and leading race organisers.
Velon have become embroiled in a legal battle with the UCI at the European Commission, with the UCI subsequently allocating part of its Emergency Funds – paid by the teams – to cover their legal costs. Those legal proceedings started in late 2019, with Velon claiming that the UCI had used it regulatory power and political leverage to seek to block Velon's business activities.
Cyclingnews understands the European Commission will take several months to decide if it will even hear the case, with any final verdict likely to take several years.
When asked on Wednesday evening about Mitchelton-Scott's withdrawal, Bartlett sent Cyclingnews a statement: “MTS management were charged with reviewing all parts of the team’s business activities (which all sports businesses are doing of course) as the team rose to the challenges of this year (financial and sporting) and have discussed with Velon their shareholding in the Company. MTS have reconfirmed they’re committed to Velon’s business projects going forward and the Company and the other Shareholding teams will privately discuss their shareholding.”
