Share sale great news for F1, says CVC’s Mackenzie

F1 Group majority shareholder CVC Capital Partners has confirmed that it has sold a large chunk of its stake in the business.

In a statement, the company said that “three leading institutional investors have together invested US$1.6 billion in cash for equity interests in Formula 1, acquiring in aggregate 21% of the company.” It adds that “CVC will continue to be Formula 1’s largest and controlling shareholder.”

The three buyers are BlackRock, Norges Bank Investment Management, and Waddell & Reed.

CVC managing partner Donald Mackenzie said: “This is great news for Formula One and an important step in its development. CVC became the controlling shareholder of Formula One in 2006.

“Since that date we have supported the company and its management as they have grown the company with great success. The addition of these three highly regarded investors to our share register is validation of this success, and we look forward to working with our new partners over the coming year.”

The price values the business at over $7bn. Plans are still progressing for a public sale of F1 shares on the Singapore stock exchange.

Meanwhile Sky News has reported that Unilever chief financial officer Jean-Marc Huet will join the F1 board as a non-executive director.

2 Comments

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2 responses to “Share sale great news for F1, says CVC’s Mackenzie

  1. Well it’s certainly great news for CVC… not sure about the fan in the grandstand.

  2. thejudge13

    What value does it add to F1? This is the secondary trading of shares already issued to Bernie & CVC for a paultry $1m a year by Bernie’s mate Max Mosely (Head of the FIA at the time c. 2004).

    The FIA should investigate the value it received from this deal by a previous incumbent of the presidential role. Last year CVC and BE received a dividend of $1.5bn. Certain teams struggle to operate on $50m a year.

    Further, the actual nature of this deal is highly likely to be subject to certain criterea being met. With no Concorde agreement in place – how is it possible to capitalise the value of F1 revenues for the next 8 years?

    With announcements today re: France unlikely for 2013 (French Sports Minister), Jersey in doubt for next year (yesterdays news), I would be highly nervous about the ability of F1 to expand much further.

    Most likely the finalisation of this deal is dependent on the sucessful float of FOM and has cash up front clauses as first call to the new partners (ie they get paid first should the float be less sucesful than anticipated) – together with buy back clauses at a fixed price.should the price not be met.

    This is simply a contingent future deal designed to set a marker out to “prove” the valuation of F1 being claimed by CVC and BE.

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