Penske Alltel sponsorship in jeopardy? UPDATE #7 Verizon will fully fund the No. 12 Sprint Cup car of Penske Racing this season but the company's logo and name will not be allowed on the paint scheme.
"The [Cup] car will be identified and branded as the Penske Dodge Charger," said Walt Czarnecki, the executive vice president of Penske Corporation.
That means David Stremme, who replaces Ryan Newman in the No. 12, could find himself promoting Verizon even though the name can't be on the car, thanks to a 2004 ruling after Nextel became the top series sponsor (it was since become Sprint). That ruling allowed existing wireless communication companies with teams and tracks to keep their sponsorship, unless a team or company changed hands.
Verizon took over Alltel, the long-time sponsor of the No. 12, on Jan. 9.
Earlier, the ruling forced Richard Childress Racing to seek a replacement for Cingular Wireless on the No. 31 car of Jeff Burton after it merged with AT&T and kept the AT&T name.
Czarnecki doesn't believe Penske will have to find a replacement for Verizon because of the multi-year deal it signed with Alltel.
"Once the business transaction occurred NASCAR was kept fully informed of what was transpiring," he said. "NASCAR has made it very clear, even with Alltel, what their requirements were as far as branding on the cars and branding at the track.
"We're working with NASCAR and the people at Verizon. I believe we'll be able to accommodate all of those requirements."
Verizon will be on the No. 12 Nationwide Series entry driven by Justin Allgaier.08/20/08 This rumor is upgraded to 'fact' today. Current primary sponsor Alltel, which merged with Verizon this spring, has been forced to leave the Sprint Cup series at the conclusion of 2008. Yahoo! Sports
06/16/08 We are upgrading this rumor to 'strong' today. Car owner Roger Penske said he has not had any conversations with Alltel officials since the recent announcement Verizon will buy Alltel, a deal that could force Penske to find another sponsor.
NASCAR officials indicate that Verizon won't be able to replace Alltel as sponsor for Ryan Newman's car. Only wireless companies already in the sport were allowed to remain when Nextel, which later became Sprint, took over as series sponsor.
Penske says he hasn't needed to talk with Alltel officials until the company decides how the new version will be branded. If the Alltel brand goes away, so, it appears, will the sponsorship.
06/09/08 Ryan Newman already has been in discussions about his future with Penske Racing, and now the issue is complicated with the uncertainty over sponsor Alltel. Alltel and Verizon announced Thursday that Verizon has agreed to purchase Alltel, with the transaction completed by the end of the year pending approval from industry regulators. Verizon plans to drop the Alltel brand, and NASCAR officials are adamant that Verizon cannot replace Alltel on the car because Verizon was not grandfathered in when NASCAR signed Nextel as its premier series sponsor in 2003. Will the uncertainty of the sponsor impact negotiations? “Long term, yeah, it’s going to have an influence,” Newman said on Friday after qualifying at Pocono Raceway. “I don’t know what that influence is yet. Obviously, it’s new news to everybody, including most of the people at Alltel. I’ll keep doing what I usually do and see what happens.” Penske Racing has a long-term deal with Alltel beyond this season, and its status might not be determined until late in the season or early next year depending on when the deal is completed and when Verizon drops the Alltel name. Newman could sign a contract without a committed sponsor but that is rare for marquee drivers. “I don’t know,” Newman said when asked if he would sign without a sponsor commitment. “I have no idea how long things are going to take and what the situation is going to be like.” SceneDaily
06/09/08 Team owner Roger Penske said he does not believe uncertainty surrounding primary sponsor Alltel will affect negotiations with driver #12-Ryan Newman. Communications company Alltel last week indicated it has agreed to sell to its business Verizon in a deal that should conclude by the end of this year. Verizon will not be able to replace Alltel as a sponsor on Newman's car, NASCAR officials said, citing the ATT/Cingular issue involving Richard Childress Racing and Jeff Burton's car last year. "We have not had any discussion strategically how that sale will affect the brand at this point," Penske said Sunday at Pocono Raceway. "They have a number of options. It's way too early for me to speculate what's going to happen with the sponsorship. We're waiting to see when the transaction, if it happens, when it gets executed and what's going to be the brand strategy." Penske said his team could absorb any financial issues if Alltel has to withdraw. "We have a long-term commitment with Alltel, and I'm certainly sure they wouldn't leave us high and dry," Penske said. "We're a team that can operate with or without a sponsor. We have done it in the past." Newman, who joined Penske Racing with Alltel in 2002, continues to negotiate with Penske Racing. Newman, whose contract expires at the end of this year, said he is not concerned about this future. "I know that once you're in this place you're pretty much locked in unless you screw up," Newman said. "There's no point in being emotional about something that doesn't require emotion." Newman also said he is talking to other teams. "I have to do that to be fair to myself," Newman said. "I'm not leading the points, and if I was, it would be a no-brainer. It's not like marriage. It's not like we're locked in for life. You can stop with whoever you're dating and date someone else. You can have more than one phone number in your phone." Penske said the negotiations with Newman have been "very open." "I've talked to drivers, and drivers have talked to us," Penske said. "Newman and I have had very open conversations for several months. It's good that everybody gets a chance to see what's out there and what are the opportunities and at the time we've got to make a decision, we'll make it." Penske also addressed a rumor that he is interested in buying Chip Ganassi Racing with Felix Sabates, saying there is nothing to it. "Chip's been a friend of mine for a long time, and I think that all came out of a comment, 'How can we work together to get better?' " Penske said. ESPN.com
06/06/08 Ryan Newman already has been in discussions about his future with Penske Racing, and now the issue is complicated with the uncertainty over sponsor Alltel.
The only full-time sponsor Newman has known since he began stock-car racing has been Alltel, which began with him in 2000 as he made his way into full-time Cup racing in 2002.
Will the uncertainty of the sponsor impact negotiations?
“Long term, yeah, it’s going to have an influence,” Newman said on Friday after qualifying at Pocono Raceway. “I don’t know what that influence is yet. Obviously, it’s new news to everybody, including most of the people at Alltel. I’ll keep doing what I usually do and see what happens.”
Penske Racing has a long-term deal with Alltel beyond this season, and its status might not be determined until late in the season or early next year depending on when the deal is completed and when Verizon drops the Alltel name.
Newman could sign a contract without a committed sponsor but that is rare for marquee drivers.
“I don’t know,” Newman said when asked if he would sign without a sponsor commitment. “I have no idea how long things are going to take and what the situation is going to be like.”06/05/08 Verizon Wireless agreed to buy Alltel Corp. for $28.1 billion in cash and debt to overtake AT&T Inc. as the biggest mobile-phone company in the U.S. The deal is worth 2.1 percent more than the $27.5 billion TPG Inc. and Goldman Sachs Group Inc. paid last year to take Alltel private. The acquisition includes about $5.9 billion in cash and $22.2 billion in debt. Parent Verizon Communications Inc. rose the most in more than five years in New York trading.
Verizon Wireless Chief Executive Officer Lowell McAdam gets 13 million clients and plans to reap $9 billion in total savings from the purchase, which may help him offer discounts. The sellers make a 28 percent profit on their investment, while their lenders are repaid almost in full as Verizon uses its A credit rating to refinance the Alltel debt on their books.
``The banks may benefit, but ultimately, the real impetus for TPG selling is they achieved a substantial return in a short period,'' Chris Taggert, an analyst at fixed-income research firm CreditSights Inc. in New York, said in an interview.
The purchase will allow Verizon Wireless, jointly owned by Verizon Communications and Vodafone Group Plc, to start offering service in 57 rural markets, according to a statement today. Basking Ridge, New Jersey-based Verizon Wireless said the transaction may help save as much as $1 billion in the second year after it closes by reducing advertising and roaming costs. Bloomberg.com
06/04/08 Verizon Communications Inc., seeking to challenge AT&T Inc., is in discussions to buy wireless provider Alltel Corp., according to two people familiar with the talks.
|Alltel's future in NASCAR is clouded|
TPG Inc. and Goldman Sachs Group Inc., which took Alltel private last year in a deal valued at $27.5 billion including debt, would get a slight premium to the equity they invested in the Little Rock, Arkansas-based company, said one person, who asked not to be identified because the talks are private. Their lenders would get less than face value for the debt they still hold on their books.
A deal would make New York-based Verizon the top mobile- telephone company in the U.S., passing AT&T and adding Alltel's rural operations, which make up the country's biggest geographic network. Verizon Chief Executive Officer Ivan Seidenberg is relying on wireless as customers scrap land lines.
``All of the U.S. operators are racing to increase their exposure to wireless because it has the best growth prospects of anything in their portfolio,'' said Craig Moffett, an analyst with Sanford C. Bernstein & Co. in New York. Bloomberg
If Verizon or AT&T buy Alltel, Alltel's days in NASCAR are numbered if they try to change their name. Recall the AT&T sponsorship controversy in NASCAR whereby Sprint won their case to have AT&T thrown out in another year because of the name change from Cingular to AT&T. The same will be the case with Alltel, that was also grandfathered in when Sprint became the Cup series title sponsor.