Is this Bernie’s Big Farewell?

Liberty Media to buy F1.  Formula One is not in a great place right now. TV ratings are on the slide, drivers are not happy with the new ...

Liberty Media to buy F1. 

Formula One is not in a great place right now. TV ratings are on the slide, drivers are not happy with the new rules, the cost of being competitive is going through the roof, and to add insult to injury, F1 supremo Bernie Ecclestone has called the current series “CRAP”. But in spite of all of this, good ol’ Bernie seems to have found a buyer for the 35% share owned by CVC Capital Partners.


In what has been touted as the biggest ever sports deal, Liberty Media seems to be on the home straight in its bid to buy a controlling stake in Formula One. The deal - said to be worth some US$8.4 billion, split into US$4.4 billion cash and US$4.1 billion in debt - will end years of speculation about the ownership of the company, which of course owns the world’s top car racing series.

Liberty Media is a US-based outfit run by ridiculously rich media tycoon, John Malone, who just happens to also own the Atlanta Braves, the Major League Baseball outfit, and also just happens to be the largest landowner in the US of A. The deal is thought to be for just 20% of the shareholding and if it goes through, will give the seller, CVC, a cool US$6.4 billion profit over ten years for the outgoing shareholder.

CVC has been looking for an exit for some time, and had already sold half of the shares it originally purchased back in 2006, but this is as close to a full exit as it has come. The deal is slightly complicated by separate negotiations that CVC is reported to still be in with RSE Ventures, another American outfit run by Miami Dolphins' owner, Stephen Ross, and the fact that another major shareholder, Norge, is also wanting to sell up.

So, is the end for the 85-year-old Bernie Ecclestone, who has run the world of Formula One for the past forty years? After all, under the current ownership, he is just an employee. Ecclestone will remain a shareholder of Formula One if and when the deal is done, as he owns 5.3% of the shares in his own right and and a further 8.5% through his family's Bambino Trust. More than that, though, it is generally believed that after being the head of the world’s top auto sport for so long and given his level of influence, he will have another three years as the CEO of Formula One, as a sort of prolonged handover period. That hasn’t stopped the rumour mill springing into action though, and Formula E boss, Alejandro Agag, is already being tipped as a possible successor.

The big question is whether having an American company in charge will be a good thing or not. After all, Formula One is just another global sport that the Americanlanders have turned their backs on. F1 supremo Bernie believes that Liberty Media is a good fit and is not buying into F1 as a hobby. Malone went one further when he claimed that they were entering with firm ideas on how to grow the existing F1 events, using their expertise in media, entertainment and digital live events.

Assuming that European regulators don’t come in and spoil the party, there are real issues that the new American owners need to address, such as the falling appeal to young audiences, ultra-competitive sporting landscape and rising costs of competing and spectating. For sure, CVC did well from its investment, as CVC co-owner Donald Mackenzie has said, and there seems to be a bit of a buzz around the future with Liberty. But this is definitely the beginning of the end for Bernie and that has to add a lot of uncertainty to the mix.

See ya!


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