Formula One Takeover Details: Bernie's Still the Boss, New Chairman Announced
New details about the Formula One purchase trickled out last night after the buyer, Liberty Media Corp., agreed a deal to take over the sport.
The U.S.-based entertainment and telecommunications giant will initially pay $4.4 billion for a controlling stake in the franchise, The Guardian reports, and a familiar white-haired figure will keep his job.
The cash-and-stock deal wrestles control of the sport away from CVC Capital partners, which has controlled the franchise for the past decade. Liberty Media, headed by tycoon John Malone, will hold an 18.7 percent stake in Formula One until the deal closes in 2017, at which point the company gains all of the voting shares. CVC will reportedly remain a non-voting shareholder.
In a statement, Liberty Media claimed, “The transaction price represents an enterprise value for Formula One of $8 (billion) and an equity value of $4.4 (billion).”
Bernie Ecclestone, the Formula One’s snow-haired 85-year-old chief executive, will keep his job, but he’ll be working with a new chairman. Liberty Media claims, “Chase Carey will serve as the new chairman of Formula One, succeeding Peter Brabeck-Letmathe, who will remain on Formula One’s board as a non-executive director.”
Yesterday, Reuters reported that Ecclestone was asked to stay on for another three years as CEO.
Formula One is seen as a cash cow for Liberty Media, which plans to use its media prowess to milk more profits from the lucrative franchise. “There’s an opportunity to continue to build this business and take it to the next level,” Carey said during an investor call late yesterday, according to the Wall Street Journal.
Carey claims that Formula One attracts a large TV audience — one with all the right demographics to lure in big-buck advertisers.
[Image: Leo Hidalgo/ Flickr]
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- Inside Looking Out You should care. With GM will die America. All signs are there. How about the Arsenal of Democracy? Toyota?
- DenverMike What else did anyone think, when GM was losing tens of billions a year, year after year?
- Bill Wade GM says they're killing Android Auto and Apple Carplay. Any company that makes decisions like that is doomed to die.
- Jeff S I don't believe gm will die but that it will continue to shrink in product and market share and it will probably be acquired by a foreign manufacturer. I doubt gm lacks funds as it did in 2008 and that they have more than enough cash at hand but gm will not expand as it did in the past and the emphasis is more on profitability and cutting costs to the bone. Making gm a more attractive takeover target and cut costs at the expense of more desirable and reliable products. At the time of Farago's article I was in favor of the Government bailout more to save jobs and suppliers but today I would not be in favor of the bailout. My opinions on gm have changed since 2008 and 2009 and now I really don't care if gm survives or not.
- Kwik_Shift I was a GM fan boy until it ended in 2013 when I traded in my Avalanche to go over to Nissan.
The disparity of the haves and have not is striking these days in Motorsport in general, especially in F1. Honestly , any middling F1 driver can be put in the Mercedes car and podium every race. I mean Hamilton started from the back last week and still took a podium spot. I still prefer sports car racing with production based vehicles for the best wheel to wheel racing entertainment. I still will make the trek to Montreal (or maybe Austin) every 3-4 years for the live human spectacle though
Chase Carey was raised in my hometown and settled there after Harvard. Carey is #2 to Rupert Murdoch as Vice Chairman of 21st Century Fox . At 62, this must be fun for him.