poidda
12th February 2009, 03:00 PM
Will Suncorp Stadium become Lang Park again?
Chris Barrett | February 9, 2009
Suncorp has refused to guarantee it will extend its multi-million dollar naming rights sponsorship of Lang Park beyond 2009 - but a leading analyst predicts the deal may be one of the first things to go when a new chief executive officer arrives to "clear the decks".
The under-fire Queensland bank and insurance group has taken a battering on the balance sheet, with reduced profit forecasts and an increase in bad debts prompting a $855m capital-raising measure that stunned the market last week and was the forerunner to Monday's whopping 25 per cent single-day drop in its stock.
Adding to their share price woes, Suncorp's insurance division is also facing major exposure to claims from the Victorian bushfires and the north Queensland floods.
The company's pain has raised doubts about their prospect of continuing their 15-year naming rights sponsorship of Lang Park when their current deal expires at the start of next year, leading to speculation of a possible return to its original name - in a similar way to which the traditional Sheffield Shield cricket competition has been restored after a decade as the Pura Cup.
ABN Amro Morgans adviser Tony Russell said it was a decision that would rest with the yet-to-be-named new CEO.
"That's probably where the decision will come from down the track," Mr Russell said.
"Any CEO coming into an organisation at this time will absolutely want to clear the decks. Whether the sponsorship of the stadium goes as a result of that I don't know, but it will certainly be in the mix.
"You would have thought all costs would have to come under heavy scrutiny in their current predicament."
Mr Russell said Suncorp's new boss, a replacement for John Mulcahy, was likely to question the actual monetary value the stadium sponsorship provided.
"You expect them to get great exposure but that's very intangible - you don't know what you're getting back from that," he said.
"Is there a value to your business?"
Mulcahy, who had been in charge at Suncorp for six years before his resignation last week, will remain CEO and retain a place on the board until a replacement is found.
A spokesman for Suncorp, Jamin Smith, said the group was yet to confirm whether it would extend the high-profile arrangement that allows the company to beam its name across the 52,000 capacity Milton football ground.
"Suncorp is very pleased with its sponsorship of Suncorp Stadium and expects to continue its naming rights sponsorship well into the future," he said.
The sponsorship of Queensland's top sports venue - home of State of Origin matches, the Brisbane Broncos, the Queensland Reds and Roar and other international matches - is understood to cost Suncorp up to $5 million a year, putting it in the same region as Sydney's ANZ Stadium, ($31m over six years) and the Telstra Dome ($25m over five years) in Melbourne.
It is a cash investment that would constitute a major portion of any company's sponsorship budget but one which is still great value in terms of brand awareness, say analysts.
"It's an iconic sponsorship," said Vaughan O'Connor, the managing director of media buying company FBI.
"Sponsorship can be one of the things that's the easiest thing to cut. But I think even in the recessionary mode that the economy's shifting to, the big properties like that would still be highly valued to any business.
"Ultimately it will come down to where it sits in the priority list."
Sport Minister Judy Spence confirmed that the naming rights for the stadium were up for renewal at the start of 2010 but said the ground was "synonymous" with Suncorp.
"I am advised that, justifiably, Suncorp is very pleased with its sponsorship of Suncorp Stadium and expects to continue its naming rights sponsorship well into the future," she said.
Lang Park officially became Suncorp Stadium in 1994 and the financial group timed its latest six-year deal to coincide with the re-opening of the ground in 2003 following its $280m redevelopment.
The prospect of Suncorp abandoning a new naming rights deal raises the possibility of the ground returning to its traditional name in much the same way as the Sheffield Shield has been restored after a 10-year existence as the Pura Cup.
The new major sponsor of the interstate four-day cricket competition is Sanitarium Weet-Bix but under that company's deal with Cricket Australia the original name and trophy have been brought back in preference to a new naming rights agreement.
http://www.brisbanetimes.com.au/news/sport/will-suncorp-stadium-become-lang-park-again/2009/02/12/1234028176568.html?page=2
:) :smt038
Chris Barrett | February 9, 2009
Suncorp has refused to guarantee it will extend its multi-million dollar naming rights sponsorship of Lang Park beyond 2009 - but a leading analyst predicts the deal may be one of the first things to go when a new chief executive officer arrives to "clear the decks".
The under-fire Queensland bank and insurance group has taken a battering on the balance sheet, with reduced profit forecasts and an increase in bad debts prompting a $855m capital-raising measure that stunned the market last week and was the forerunner to Monday's whopping 25 per cent single-day drop in its stock.
Adding to their share price woes, Suncorp's insurance division is also facing major exposure to claims from the Victorian bushfires and the north Queensland floods.
The company's pain has raised doubts about their prospect of continuing their 15-year naming rights sponsorship of Lang Park when their current deal expires at the start of next year, leading to speculation of a possible return to its original name - in a similar way to which the traditional Sheffield Shield cricket competition has been restored after a decade as the Pura Cup.
ABN Amro Morgans adviser Tony Russell said it was a decision that would rest with the yet-to-be-named new CEO.
"That's probably where the decision will come from down the track," Mr Russell said.
"Any CEO coming into an organisation at this time will absolutely want to clear the decks. Whether the sponsorship of the stadium goes as a result of that I don't know, but it will certainly be in the mix.
"You would have thought all costs would have to come under heavy scrutiny in their current predicament."
Mr Russell said Suncorp's new boss, a replacement for John Mulcahy, was likely to question the actual monetary value the stadium sponsorship provided.
"You expect them to get great exposure but that's very intangible - you don't know what you're getting back from that," he said.
"Is there a value to your business?"
Mulcahy, who had been in charge at Suncorp for six years before his resignation last week, will remain CEO and retain a place on the board until a replacement is found.
A spokesman for Suncorp, Jamin Smith, said the group was yet to confirm whether it would extend the high-profile arrangement that allows the company to beam its name across the 52,000 capacity Milton football ground.
"Suncorp is very pleased with its sponsorship of Suncorp Stadium and expects to continue its naming rights sponsorship well into the future," he said.
The sponsorship of Queensland's top sports venue - home of State of Origin matches, the Brisbane Broncos, the Queensland Reds and Roar and other international matches - is understood to cost Suncorp up to $5 million a year, putting it in the same region as Sydney's ANZ Stadium, ($31m over six years) and the Telstra Dome ($25m over five years) in Melbourne.
It is a cash investment that would constitute a major portion of any company's sponsorship budget but one which is still great value in terms of brand awareness, say analysts.
"It's an iconic sponsorship," said Vaughan O'Connor, the managing director of media buying company FBI.
"Sponsorship can be one of the things that's the easiest thing to cut. But I think even in the recessionary mode that the economy's shifting to, the big properties like that would still be highly valued to any business.
"Ultimately it will come down to where it sits in the priority list."
Sport Minister Judy Spence confirmed that the naming rights for the stadium were up for renewal at the start of 2010 but said the ground was "synonymous" with Suncorp.
"I am advised that, justifiably, Suncorp is very pleased with its sponsorship of Suncorp Stadium and expects to continue its naming rights sponsorship well into the future," she said.
Lang Park officially became Suncorp Stadium in 1994 and the financial group timed its latest six-year deal to coincide with the re-opening of the ground in 2003 following its $280m redevelopment.
The prospect of Suncorp abandoning a new naming rights deal raises the possibility of the ground returning to its traditional name in much the same way as the Sheffield Shield has been restored after a 10-year existence as the Pura Cup.
The new major sponsor of the interstate four-day cricket competition is Sanitarium Weet-Bix but under that company's deal with Cricket Australia the original name and trophy have been brought back in preference to a new naming rights agreement.
http://www.brisbanetimes.com.au/news/sport/will-suncorp-stadium-become-lang-park-again/2009/02/12/1234028176568.html?page=2
:) :smt038