MILAN — Luxury seems to have fallen out of love with the America's Cup.
After an investment over the last decade totalling more than $80 million, Prada said Friday that it will not compete in the next edition of the famed yacht race, scheduled to be held in Valencia, Spain, in 2009. Last month, Louis Vuitton said it was parting ways with the Cup, distancing itself from "a more commercial approach" to the race of recent years and less exclusive crowds and sponsors drawn to the event.
Costs of taking part in the Cup have skyrocketed over the last few years but, in a statement, Prada chief Patrizio Bertelli dismissed this issue, stating that "a cycle had come to an end," and that the decision was made despite the availability of "significant human and financial resources."
Bertelli first entered the America's Cup in 1997 with the "Luna Rossa" sailing boat, which competed in three editions of the race — in 2000, 2002 and 2007. Prada spent about $50 million on the first losing effort and invested $38.3 million of the estimated $90 million needed for the second race series, with the remainder coming from the Prada family's company Maestrale Holding Srl.
In September 2004, Bertelli inked a deal with Telecom Italia to sponsor the new "Luna Rossa" sailing boat that competed for the 32nd America's Cup in Valencia, which concluded last month. Telecom Italia is headed by Italian tycoon Marco Tronchetti Provera, who shares a passion for sailing with Bertelli. Other sponsors included bank Intesa Sanpaolo, which owns five percent of Prada, and the Italian Yacht Club.
The corporation that manages the "Luna Rossa: boats is controlled by Maestrale Holding and Telecom Italia, which has a 49 percent stake. "Luna Rossa" had a budget of about 85 million euros, or $117.3 million at current exchange, for the latest Cup.
"Luna Rossa" won the Louis Vuitton Cup in 2000, qualifying it to race for the America's Cup. Bertelli's boat then lost to Team New Zealand in a best-of-nine series of races. The sleek silver- and-red boat was eliminated from the Louis Vuitton Cup in New Zealand in January 2003. Swiss team Alinghi won the last two editions of the America's Cup.
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