All Change for Formula One as Billion-Dollar Deal Looms

AFP

First published: September 6, 2016, 9:20 AM IST | Updated: September 6, 2016
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All Change for Formula One as Billion-Dollar Deal Looms
(Photo Credit: Reuters)

A new chapter dawns for Formula One with American media mogul John Malone poised to become the glittering but flawed sporting jewel's new custodian.

The Malone-backed Liberty Media has emerged in pole position to buy F1 after interest from broadcaster Sky, Paris Saint-Germain's owner Qatar Sports Investments and Stephen Ross, owner of MLS side the Miami Dolphins, waned.

The high octane sport's octogenarian ringmaster Bernie Ecclestone told German magazine Auto Motor und Sport at last weekend's Italian Grand Prix that a deal was imminent, possibly as early as Tuesday.

Monday's edition of British newspaper Financial Times suggested talks between Liberty Media and current 35 percent majority stake owners CVC Partners, were "at an advanced stage".

The 75-year-old Malone's media empire is expected to take an initial 10-15 percent stake valued at $1.3 billion-$2.7 billion (£1-£2bn, 1.2bn euros-2.4bn euros), en route to becoming majority owners in a deal valuing F1 at $8-$9 billion.

The FT, quoting "people briefed in the talks", say that Chase Carey, executive vice-chairman of Rupert Murdoch's 21st Century Fox, would be appointed F1's new chairman.

Liberty Media already has interest in several sports and entertainment businesses, including the Atlanta Braves Major League baseball team.

If it goes ahead this deal would end years of rumour and speculation over F1's future.

Ecclestone, who owns 5.3 percent and with his Bambino Trust a further 8.3 percent, is the mastermind behind F1's evolution over the past 40 years into a billion-dollar sporting business.

Ecclestone, who forked up $100 million to the German authorities to end a high profile bribery trial in 2014, held talks with CVC co-chairman Donald Mackenzie at Monza, the BBC reported.

With the sport's attraction to television audiences undermined by the recent domination of first Red Bull and now Mercedes, Liberty's arrival was welcomed by key personalities in the pits.

Red Bull's Christian Horner told The Guardian: "It could be a really exciting deal for Formula One if it happens...but for a new group to come in without (Ecclestone) being there would be very difficult, so I'd assume he'll be around for some time."

Mercedes team chief Toto Wolff was equally enthusiastic.

"If there is an investor that wants to buy the shares it is good news for Formula One. It is good news that an American media company buys Formula One."

Wolff and other analysts will hope that a specialist media empire such as Liberty can reignite interest in a sport which according to official figures has seen its global viewing audience shed 200 million viewers since 2008.

News of the imminent deal would see the flag fall on CVC's chequered association.

One of the world's leading private equity firms, it invested in F1 in 2006 for around $1.2bn but has been attacked for taking too much out of the sport.

In 2014, Bob Fernley, Force India's deputy team chief, accused CVC of reaping the massive rewards in F1 without putting anything back.

He accused them of having "no interest whatsoever in the future of Formula One".

CVC previously sold a 21 percent share to US-based fund manager Waddell & Reed in 2012, while also selling shares to another American investment group, BlackRock, and Norwegian bank Norges.

If all the reports are to be believed, Liberty Media will be on the grid introducing themselves to Lewis Hamilton and company when the F1 circus pitches up in Singapore on Sunday week.

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