Venture Capital firm to buy F1

[gt]

CVC Capital Plans to Buy Majority of Formula One, Reuters Says Page 1/2

By Sheenagh Archey
Nov. 25 (Bloomberg) -- CVC Capital Partners Ltd., a U.K.
buyout firm, plans to buy a majority stake in Formula One, Reuters
reported, citing an unidentified banker.
Bernie Ecclestone, head of Formula One racing, and Bayerische
Landesbank will sell their stakes in SLEC, Formula One's holding
company, to London-based CVC, the newswire said.
The buyout firm is also negotiating with Lehman Brothers
Holdings Inc. and JPMorgan Chase & Co. about buying their minority
stakes, Reuters said. No prices were given, the newswire said.
Ecclestone, 75, will remain head of Formula One racing,
Reuters said.

(Reuters, 11-25)

Hmmm, so yet again BE manages to cash in whilst still remaining in charge
Wonder what the future will hold for F1 in the hands of a private equity firm..

[flemke]

gt said:

Wonder what the future will hold for F1 in the hands of a private equity firm..

To have as much money squeezed out of it as is humanly possible.
You thought that the "sport" was scraping the bottom of the lowest-common-denominator barrel already? Stay tuned...(that is, until you turn your set off forever).

[JonRB]

flemke said:

To have as much money squeezed out of it as is humanly possible.

How will that differ from the current state of affairs?

[gt]

flemke said:

gt said: Wonder what the future will hold for F1 in the hands of a private equity firm.. To have as much money squeezed out of it as is humanly possible. You thought that the "sport" was scraping the bottom of the lowest-common-denominator barrel already? Stay tuned...(that is, until you turn your set off forever).

Agree on the money squeezing, but thats been the case for the last 8 years, and they got their fingers burnt last time (the consortium, and Kirsch media before them)
Whatever they paid in the hope of being able to squeeze cash, they better move quickly before the manufacturers bugger off and they are left holding thin air, seems like a bit of a wild risk to me.

As usual you can be sure the winner will be BE, and the losers the "fans" (unless they decide in a stroke of genius to use the accountants as apex marker posts)

quite depressing really

[flemke]

JonRB said:

How will that differ from the current state of affairs?

Fair question. Say what you will about Bernie - and there is more than enough to complain about - but no one could doubt that he is a genuine race fan (how many GPs does Oswald Jr attend each year?).
If someone takes over F1 purely as an investment - and any VC or PE firm is obliged to use its client's money only for that purpose - the nous, the insight and the credibility of the owner will be lost.
Spa can't pay as big a fee as the new circuit in Moscow - no problem, cut them loose and get me Putin on the phone. Silverstone is owned by a private club and lacks the government subsidy that China enjoys - cool, let's do two races a year in China. Monza'a got a noise problem and won't be able to commit until February - we can't wait until February, so sign up that street circuit in Dallas. The teams don't want to do 20 races a year because its too hard on the staff - well let's see how they like 22!
As I said, stay tuned.

The future of racing fans -

[P490KVP]

Interesting timing of this deal because the GPWC is far from dead, and as F1 is now dominated by manufacturer teams if they all up sticks their investment might not ammount to much...