June 24, 2015 – Formula One’s owners CVC Capital Partners may finally be getting rid of its cash cow, after years of attempts to float or sell off the increasingly struggling motorsport. The owner of American football team Miami Dolphins is reportedly teaming up with the Qataris to buy the private equity firm’s controlling stake for $7-8bn (£4.4-5.1bn).
RSE Ventures, which was founded by 75-year-old American sports and property magnate Stephen Ross, is looking to buy CVC’s 35.5% stake in F1. It’s apparently being backed by Paris St-German football team owner Qatar Sports Investments, but there’s no formal offer on the table just yet.
CVC tried and failed to float the sport twice in 2012 and 2013. After the first flop, it sold down its 63% stake to US investment giants Blackrock and Waddell & Reed and Norway’s Norges Bank for $1.6bn. Last year American cable TV giant Liberty walked away from a bid.
But what of Bernie Ecclestone, the man with more lives than Sepp Blatter? ‘My shares will be sold with theirs,’ he told the FT, when asked about the fate of his 5% stake in any deal. The 84-year-old billionaire denied knowledge of any specific offer, saying there were ‘three or four’ suitors interested.
‘I have no idea whether any of these people have got closer with this, but CVC are in the business of buying and selling companies,’ Ecclestone told The Times. ‘They are very happy with F1 and Donald [Mackenzie, CVC’s chairman,] is not an enthusiastic seller, but their business is selling and everything has a price.’
Ecclestone settled a German bribery charge out of court for a staggering $100m last year. In December, CVC tried to appoint former Diageo boss Paul Walsh as executive chairman to put a leash on the dealmaker, but he outmanoeuvered them all (Walsh was then publicly appointed as a non-executive director, but reportedly never took up the role).
RSE and Qatar (which is apparently miffed it doesn’t have a Grand Prix when neighbours Bahrain and Abu Dhabi do) must not mind Ecclestone’s machinations and disdain for winning over new and younger fans. Or they know they can’t seal the deal without him. ‘They believe he brings a lot to the sport and they can help expand it into the US and Chinese markets,’ a source told the FT.
Either way CVC is probably revving to get rid of a sport beset by falling audience numbers, soaring costs and financially-struggling teams. Whether a deal will go through and any new owners will be able to take the chequered flag once again is another question.