The chances of the America's Cup being defended in New Zealand appear to be slipping, with an offer worth around $100 million from the Government and Auckland Council apparently rejected.
Negotiators appointed by the Crown have been trying since March to thrash out a deal with Team New Zealand, which beat Luna Rossa to retain the Auld Mug on March 17.
The final race of the 36th America's Cup kicked off a three-month period of good faith negotiations, during which Auckland had the first right of refusal to host the next match. That window ends on June 17.
The joint bid by the Government and Auckland Council is believed to have been worth around $100m, made up of cash and "in kind" support such as the use of land in Auckland's Viaduct Harbour.
Sources with knowledge of the talks have told the Herald that Team New Zealand told negotiators in recent days that the bid has been rejected.
Team New Zealand is said to have wanted a package worth more than $200m. The board of the syndicate is expected to meet this week.
Although the negotiation period still has more than a fortnight to run, the source believes the Government has indicated it has tabled its best offer.
Team New Zealand, which refused to comment on ahead of the story's release, said this morning that it had recently received the Government and Auckland Council's "position" which would be considered in the coming days.
"Emirates Team New Zealand is currently still within the exclusive three-month negotiation period with Government and Council, so it is premature to comment on commercial negotiations until they have concluded," a spokesman said.
"However, we have only recently received the Government and Council position which we will now carefully consider over the next two weeks."
America's Cup Minister Stuart Nash told Newstalk ZB's Mike Hosking this morning someone was "leaking who shouldn't" and they had until June 17 to conduct good faith negotiations.
Hosking said to Nash he was being told "Team New Zealand don't want $200 million at all, and that you can actually get the Cup for less than the current one and it will all work out fine. Is that fair or not?"
Nash said the Government "had contracted MBIE, who had contracted someone else to do negotiations on our behalf. We've got until the 17th of June to conclude good faith negotiations. As far as I'm aware all negotiations are being conducted in good faith but those negotiations are still in confidence ... but I'm not one of the negotiators."
Hosking said he understood the offer of cash and kind "is the issue - is there a lot of kind and not a lot of cash - is that part of the problem?"
Nash said he had kept out of the negotiations "and so what they put forward will be they put forward".
However, any final deal had to be ratified by Cabinet, he said. He had not yet been presented with anything to take to Cabinet.
When asked if he was positive about keeping the Cup, he recognised it was a commercial operation - "almost a multi-bilion dollar operation these days".
"I have always said I would love to have the Cup in New Zealand, but I'm a realist."
He said the government wasn't a bottomless pit and wasn't able to "write out a cheque with huge zeroes".
"But we'd like it here and are negotiating in good faith."
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Sailor Chris Dickson said the event is "very attractive" and parties around the world would be interested.
"[The negotiation] is all behind closed doors and we the ratepayers and taxpayers can only wonder what's going on. $100 million sounds like a lot of money to me," he told Hosking earlier this morning.
Dickson said he thought Team New Zealand would be wise to think about their brand reputation if they took the defence offshore.
"Team New Zealand has built a very strong and valuable brand globally, largely on being New Zealanders. For them to take it somewhere else would go against the grain."
Dickson said the 2021 America's Cup had been a success, but a lot smaller than initially anticipated because of the Covid-19 pandemic.
"It feels to me we only got half a party, I think we deserve the other half and I hope they can put it together."
Team New Zealand this year confirmed they were considering whether to take the world's oldest sporting trophy overseas, warning the foiling monohulls had renewed interest that could strip its talent.
Documents showed Team New Zealand had appointed agents to seek international bids, where host cities were invited to offer a "rights/sanction fee" from the host city to the yachting syndicate, as well as to commit to covering the operating costs of the America's Cup match.
A spokeswoman for Nash this week declined to say whether the talks were at an end, or whether the Government might submit an improved offer.
"Discussions and negotiations will be commercial-in-confidence and further information is unable to be released."
Auckland Council referred questions to its economic development and events arm, Auckland Unlimited. It declined to discuss the state of negotiations.
After the Government and Auckland Council announced a $136m package to defend the America's Cup in 2018, both sides privately acknowledged that to get true value for money, Auckland needed to host at least two defences.