Thanksgiving. That rather wonderful celebration of the harvest and other blessings of the year, celebrated in the land of the free and the home of the brave. A time when people come together, sit around a table, set differences aside and proceed in a spirit of conviviality, thankful for good food, perhaps wine or a Budweiser and a good browse of the internet for Black Friday bargains. To all of my ever-growing American readership, I wish you happy Thanksgiving Day and pay my thanks to you for reading and suffering my writing with such warmth and good grace.

Sadly, there’s not much Thanksgiving spirit down in New Zealand at the moment. Legal letters have been sent to Team New Zealand claiming defamation by Mark Dunphy of the Kiwi Home Defence project and I have to say that stinks.

Many of you know the admiration that I hold both Team New Zealand and its embattled boss in and my respect for the Royal New Zealand Yacht Squadron – one of the most welcoming clubs on the planet – so as a foreign observer looking in from a helicopter angle, the very notion of club members suing club members over a he-said/she-said point of difference simply looks petty, vain and uncalled for.

Not to mention, it’s a mighty drain on time and resources and if you watch the latest Mercedes video below with Ben and James Allisson, the big battle in the Cup is time. These papers will take up headspace, debating and legal time, money and resources. None of which Team New Zealand nor Grant Dalton has in abundance right now. It’s pathetic.

©Studio Borlenghi

Now, on one hand, with an event perspective, yes I romantically think Auckland is the natural venue for the Cup and on one level I heartily agree with the Kiwi Home Defence’s raison d’etre. I’m a dreamer. But tell me I’m wrong, this is a contingent convertible, correct? This is what Morgan Stanley coined back in the early noughties as a CoCo. I spent years broking these damn things and they’re a nightmare.

The $40m NZDUSD convertible from the KHD is contingent on Team New Zealand’s ability to raise a further $80-$120m (pick a number) or else the CoCo reverts to parity and is annulled. In banking and broking terms, the CoCo might still be running but if Grant can’t raise the money from sponsors for a defence in New Zealand and has to take it overseas to gain the valuable venue fee in order to sustain the team and get to the start line, then the KHD CoCo isn’t worth the paper it’s written on.


The KHD can issue as many fancy social media posts and bleat endlessly to any journalist that will take their copy whilst pulling on the heartstrings of the nation and getting some scary legal friends involved but it’s whistling in the wind on the very financial metrics and tenets that it is promoting.

The Contingent Convertible simply doesn’t work. It’s akin to taking a punt on South American debt where loans are offered on the proviso of government support which funnily enough never come through and some developer or stock lending house that go quiet right at the moment when collateral is required, so these CoCo’s fall off having been traded around the financial markets on whisper and rumour peddled by the investment banks. That’s what this is.

In the New Zealand CoCo being promoted, there’s a contingency not only on Grant Dalton weaving his sponsorship-raising wand and undeniable genius in that sphere but also in the embattled, socialist Kiwi government coming in at the last moment with an improved offer.

If I were back as a broker on Wall Street looking at this in non-Covid times, I might be tempted by a couple of legs of this CoCo and weigh the risk as being within the machinations of state. That’s a punt I might consider and would call up a couple of clients to convince but with the Kiwi government facing down lockdown protests and a financial black hole in the economy, I’m closing the book on this and wondering what downtown lapdancing bar is open at midday.

©ACE / Studio Borlenghi

Now, if I take the whole thing from a British standpoint, it’s abundantly clear that Jim Ratcliffe and the Royal Yacht Squadron in Cowes have lit the blue touch paper and are standing back before the fireworks. They’ve played an absolute blinder here in managing to keep the Defender onside and extremely grateful with piecemeal offerings whilst creating an eye-wateringly expensive cost-of-entry under the guise of cost-cutting. It’s absolutely brilliant.

What the Cup is discovering is a weapons-grade businessman who doesn’t do losing and is sharper than a sushi chef’s knife. The most successful businessmen leave the negotiating table with the other side thinking they’ve got a great deal when in fact it’s a turkey and they’ve been stuffed. I have a feeling that’s the case here.

©KOS Picture Source / www.kospictures.com

And I have to say, I really don’t care. The goal here is to win the America’s Cup, the greatest prize in our sport and a topic of considerable consternation and downright disappointment for 170 years for us Brits. If the Cup goes to a neutral venue, as surely it now must, then that levels the playing field somewhat – but it’s not a killer blow. As Sun Tzu said in the Art of War: “Victorious warriors win first and then go to war, while defeated warriors go to war first and then seek to win.” I’m hoping we’re on the right side of this trade – for once.

It’s sad to read how this is all progressing but I have a lot of faith in the membership of the RNZYS who have it in their power to rally around their sporting team and the club’s flag. The smart move here from their perspective is to back Team New Zealand and Grant Dalton and accept that the Cup has to go overseas and believe in sport. That’s the crucial thing here. Believe in sport, believe in the team.

©KOS Picture Source / www.kospictures.com

I can tell you, we’re terrified of Team New Zealand deep down. Their brilliance is not to be under-played. Yes I can sabre-rattle about the easiest Cup win in history and just how mighty Ineos are looking right now – what else would you expect me to say? But underneath we know what’s ahead.

We think Mercedes will have the answer. We pray they will but blimey there’s a lot of variables and a wounded, snarling, determined, embattled Team New Zealand is about as scary as it gets. Unleashing that Kiwi beast having been prodded and poked as it goes for a three-peat is more than a worry and it really doesn’t matter where in the world that gladiatorial battle is. Gulp.

Anywhere but Auckland is what we say. We don’t mean it.

Happy Thanksgiving.

9 thoughts on “Turkeys

  1. I wonder, perhaps, if the NYYC alternate challenge was a means of offering an “escape hatch” as it were if the situation with the current challenger became too difficult, as it has. Perhaps they should have used it while they could.


  2. Magnus,
    I am sad to say this but I think Mark Dunphy is a “Con Artist”. He has never run a big Sporting Event like the AC so why on earth should Grant Dalton trust him!


    1. I think ‘con-artist’ is a bit strong. He’s an extremely intelligent, successful, wealthy businessman who I think is trying to do his best in the circumstances. I don’t think the deal he’s proposing is quite enough and there are too many contingencies that will scupper it. The RNZYS membership are bright and capable and will ultimately make the decision on this – my guess is that sense will prevail and they will back their team and their club.


    2. If Magnus’s theory above is correct, it sounds like the one pulling the con on ETNZ is Ratcliffe.


  3. Hi Magnus, it’s entertaining to see how you put all your desperate hope in the dominant input of the F1 Mercedes team, so consequently I expect a name change to ‘Team Germany – nee Ineos’.

    Please, keep entertaining us 🙂


    Liked by 1 person

  4. There are so many reasons Why the Kiwis should continue the Americas’s Cup tradition in Auckland, don’t let Money scabbles stop it!

    Liked by 1 person

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