A source close to the ASP has opened up to SURFER with details surrounding ZoSea media’s purchase and subsequent privatization of the ASP. Last week, the ASP sent out a very general and vague press release touting the deal with ZoSea media, leaving much to speculation as to what effect this buyout would have on the future of professional competitive surfing. But according to our source, ZoSea’s takeover of the ASP is “the biggest thing to happen to professional surfing since the ASP’s inception.”
The facts behind the takeover paint a picture of a deal built not on a concrete business plan, but rather on a promise of what ZoSea could accomplish, most notably absorbing the exorbitant financial costs of running a World Tour event. “This was very much of a leap of faith on the part of the ASP board,” says our source. “It was by no means a unanimous decision by the board with more than a few voting members questioning whether or not this acquisition was best for professional surfing. That being said, at the end of the day, given the current economic climate facing many of the top brands, this is what had to happen to move professional surfing forward.”
The acquisition, which was signed as a term-sheet deal, will be formally finalized after a series of meetings between ZoSea and the current ASP Board that will take place between now and December 17. SURFER can confirm that the following changes will be made once ZoSea takes control over the ASP in 2014.
When the Deal is Finalized, ZoSea will Effectively Take Control of the World Tour Events
Currently, a number of brands own the licenses to the 10 active World Tour events. When the deal is formally signed, ZoSea will take over sole ownership of the licenses to every World Tour event in 2014. The brands that currently own the event licenses will have a right of first refusal to purchase primary sponsorship details. As an example, come 2014, Quiksilver will be given the opportunity before any other brand to sponsor the event at Snapper. The cost to purchase a primary sponsorship will be structured as follows: in 2014, it will cost $250,000 to sponsor a World Tour event; in 2015 it will cost $500,000; in 2016 the cost will settle in at $1 million. Although it differs per event, it’s currently estimated to cost an average of $3 million to run a World Tour event. Additionally, ZoSea will sell commercial spots during the webcast to both endemic and non-endemic companies.
ZoSea Will Take Over the Majority Interest of the ASP Board
The current ASP board is composed of an equal representation of World Tour surfers and board members. Under the new plan, ZoSea representatives will hold the majority of interest but will retain some surfer representatives for council. “Some of the boardmembers were wary that a board not made up of the brands and surfers could take surfing down the wrong path,” said our source. “But according to ZoSea, although they will take ownership over the ASP, they’re still keen to hear from the surfers. They won’t necessarily be asking the surfer representatives what to do, but rather how to do it.”
The Term Sheet Deal Was Agreed Upon without a Concrete Business Plan
“There was a five-year generalized plan of intent that ZoSea presented to the ASP, but there was no solidified business plan,” says our source. “For a lot of the people in that meeting, this was a little worrisome. But given the alternatives of continuing to run the event themselves, the brands decided to move forward. It was very much a ‘trust us, we know what we’re doing’ deal.” By December 17, when the deal is set to be officially signed, our source expects ZoSea to have a more concrete plan in order.
ZoSea Will Create A Single Production Team for the World Tour Events
Beginning in 2014, a single production team and announcers will be put into place. It’s not currently known who will make up that team.
Two Other Organizations Were Also in the Bidding
According to our source, two other outside agencies were also eyeing to take control of the ASP. Because of a non-disclosure agreement, those two agencies could not be named. Some ASP board members openly questioned whether it was best to sign with ZoSea, or go back and vet the other outside agencies again for a chance at a better deal.
By 2014, A Commissioner of the ASP Position Will Be Created
The position is expected to mimic that of the NFL and will most likely be filled by an ex-professional surfer in good standing with both the surfers and the industry. It is not currently known who that person will be.
Pension Plan for Male and Female World Tour Surfers
The current ASP board is composed of two surfers rep. As a means to help gain their vote, ZoSea will offer a million-dollar pension plan for World Tour surfers. “The details on the pension plan are very hazy at the moment. But I can confirm that a million-dollar plan has been put forth. How it’s going to work is still up in the air, but I can assume that there will be a lot of meetings between the surfers’ rep and ZoSea moving forward to fill in the details.”
The World Tour will Retain the Same Basic Competitive Structure as Before but Will Possibly Include Specialty Events
ZoSea will only be taking control over the men’s and women’s World Tour events, the ’QS and the PRIME events will continue to be handled by the ASP. “The WQS will still be the feeder system to the World Tour. That system seems to be working and ZoSea isn’t interested in changing it.”
There’s A Proposed Broadcast Deal with a Major Television Network
Although there is not yet a confirmed television broadcast deal in place, our source has said that ZoSea is in the works of attempting to finalize a deal that will potentially see World Tour surfing broadcast on network TV.
There Will Be An Increase In Prize Money for Both the Men and Women’s World Tour
The current prize purses for both men’s and women’s World Tour events stand at $425,000 and $110,000 respectively. Under ZoSea’s plan, the prize purse for the men’s event will increase to $500,000 and the women’s to $250,000.