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F1 changes owners....again.
This is a bit involved (and murky!) if you haven't been following the story of the fight over ownership of Formula One.
The short verison goes something like this...
Bernie sold off a large chunk of his holdings to a German company called the Kirch Group, who after writing a check for many many many millions of dollars went bust....three banks stepped in to take control of the shares, after which a power sturggle between the banks and Bernie began, ultimately with the banks winning a lawsuit to gain control. This has all taken place over the last few years and has done nothing to help secure the future of the sport obviously.
Anyway....here's the latest wrinkle.
Ecclestone, BayernLB confirm stake sale
By Michael Able and John O'Donnell November 25th 2005, 12:10 GMT
Bernie Ecclestone and bank BayernLB will sell control of Formula One to private equity investor CVC Capital Partners, they said on Friday, ending a bitter feud over the world's biggest motor racing series.
Ecclestone, the 75-year-old billionnaire who made a fortune by exploiting Formula One racing's commercial rights, said he would sell his 25 percent stake but remain as chief executive of the business.
BayernLB will also sell its holding of nearly half of the Formula One Group, which it collected three years ago as security on a unpaid loan after the collapse of Germany's Kirch media empire.
CVC is also in talks to buy the remaining shares in the company, which are owned by Lehman Brothers and JP Morgan, a source told Reuters earlier on Friday.
The parties to the deal said that a new company would be formed to house the Formula One business and that Ecclestone would still retain an unspecified stake.
For BayernLB, the sale marks the end of a tussle for control with Ecclestone, a former used-car salesman who transformed Formula One into a multi-billion-euro business.
The banks took a court action to get a bigger say in the management of Formula One, where despite owning more than 75 percent of the business they were classed as minority shareholders.
The sale comes amid uncertainty over Formula One's future.
Five major carmakers have threatened to launch their own series in 2008 unless significant changes are made to the way Formula One is run.
The Grand Prix Manufacturers Association wants more transparency and a bigger slice of the sport's commercial earnings.
Ecclestone is the son of a trawler captain who left school at 16 to become one of Britain's wealthiest and best-known businessmen.
He is seen as the sport's modern day architect who transformed it commercially by establishing a business to manage Formula One coverage and promotion rights, which saw its profits grow as the sport became more popular around the globe.
FIA, EU still to approve new F1 deal
By Jonathan Noble November 25th 2005, 14:19 GMT
The European Commission and motor racing's governing body still need to give the green light to Friday's sale of Formula One commercial rights, autosport.com has learned.
Although Formula One supremo Bernie Ecclestone and German bank BayernLB have agreed a deal with private equity investor CVC Capital Partners to a takeover of the sport's commercial rights, the matter still faces procedural hurdles over the next few weeks.
High level sources have claimed that the EU will be interested in the deal from a competitions' viewpoint, and whether a single company's control of the rights would give CVC too much influence.
The FIA side of affairs relates to the original sale of the sport's commercial rights to Ecclestone in a 100-year-deal in 2000. Part of that deal included what is referred to as a 'Don King' clause - which gives the FIA the right of veto over any subsequent sale of the rights that they did not approve of.
Boxing promoter Don King famously used a contractual clause that required any boxer wishing to challenge one of his fighters to agree to be promoted by King in the future. This ensured that King would represent which ever boxer won - effectively putting him in a win-win situation.
A spokesman for the FIA told autosport.com: "We have been aware of the discussions for some time. The completion of such a deal is contingent on the consent of the FIA.
"We await full and final details which will be considered by the FIA Senate and World Motor Sport Council in due course."
The decision will be discussed at the next meeting of the FIA World Council on December 9
It is understood, however, that there would likely be little resistance to the CVC move from the FIA – especially because of the company's good reputation in both the automotive and motor sport fields.
CVC off-shoot company Dorna have done a good job in controlling the commercial rights to MotoGP, with CVC have a controlling shareholding in the Automobile Association.
CVC looking to improve F1
By Jonathan Noble November 25th 2005, 14:24 GMT
CVC Capital Partners, who have agreed a deal to take over Formula One's commercial rights, have insisted that they are determined to make the sport a success rather than make a quick profit from the deal.
CVC, along with Bernie Ecclestone's Bambino Holdings and German bank Bayerische Landesbank, have formed the new company Alpha Prema, which will control F1's commercial rights. The move is subject to EC merger clearance and consent from the FIA.
Although there had been some speculation that CVC could be looking at making a quick profit from the move, CVC have made it clear that they have got involved in a bid with the aim of making F1 stronger. That is why Ecclestone will remain as chief executive of the Formula One Group.
CVC's Donald Mackenzie said: "CVC is committed to a flourishing and successful FIA Formula One World Championship, and will support every effort being made to maintain Formula One at the pinnacle of world motor sports.
"CVC has given its full support to the current discussions between Formula One, the teams and manufacturers to enable a successful extension of the current Concorde Agreement."
Ecclestone added: "We are delighted to have CVC as a shareholder whose long-term strategies and vision will provide the stability for teams, promoters and manufacturers. They are knowledgeable about motor sport and make an ideal partner for Formula One."
Dr Gerhard Gribkowsky of Bayerische Landesbank, which previously controlled F1's commercial rights, said: "Bayerische Landesbank is pleased to sell its stake to a reputable investor with a long term view and considerable knowledge and experience in motorsport.
"With CVC as shareholder and with the continued commitment of Mr Ecclestone and Bambino, Formula One will have the resources to further develop the business and the sport to its full potential."
Full statement from CVC:
CVC Capital Partners, Bayerische Landesbank and Bambino Holdings are pleased to announce that a new company, Alpha Prema has reached agreement to acquire Bayerische Landesbank's and the S. Ecclestone trust's ("Bambino") interests in Formula One Group. Closing is conditional on EC merger clearance and FIA consent.
The shareholders of Alpha Prema will be CVC Capital Partners ("CVC"), Bambino (through a reinvestment), Mr Bernie Ecclestone and the Formula One management team. CVC will have a majority stake in Alpha Prema and a controlling interest in the Formula One Group. Bernie Ecclestone will remain as Chief Executive of the Formula One Group and Dr Gerhard Gribkowsky (currently Chairman of SLEC Holdings), Donald Mackenzie (CVC) and a Bambino representative will join the Board of Alpha Prema.
CVC is a leading private equity firm in Europe and Asia, and has experience of investing in motorsport and rights management, through its ownership of Dorna, the company that organises and manages the commercial rights of the FIM Road Racing World Championship Grand Prix (MotoGP), which was acquired by CVC in 1998. CVC is also a controlling shareholder of the Automobile Association in the UK.
Mr Ecclestone commented: "We are delighted to have CVC as a shareholder whose long-term strategies and vision will provide the stability for teams, promoters and manufacturers. They are knowledgeable about motor sport and make an ideal partner for Formula One."
Mr Mackenzie commented: "CVC is committed to a flourishing and successful FIA Formula One World Championship, and will support every effort being made to maintain Formula One at the pinnacle of world motor sports. CVC has given its full support to the current discussions between Formula One, the teams and manufacturers to enable a successful extension of the current Concorde Agreement."
Dr Gerhard Gribkowsky commented: "Bayerische Landesbank is pleased to sell its stake to a reputable investor with a long term view and considerable knowledge and experience in motorsport. With CVC as shareholder and with the continued commitment of Mr Ecclestone and Bambino, Formula One will have the resources to further develop the business and the sport to its full potential."
GPMA ready for dialogue with new F1 owners
November 25th 2005, 14:16 GMT
The Grand Prix Manufacturers Association said on Friday they are looking forward to entering into dialogue with the new owners of Formula One's stakes.
F1 supremo Bernie Ecclestone and German bank BayernLB sold control of the sport to private equity group CVC Capital Partners on Friday.
Ecclestone, however, will remain chief executive of the business.
The five major carmakers who have threatened to launch their own series in 2008 issued a statement following the announcement, saying the news has been received "with interest".
"Today's statement by CVC Capital Partners, BayernLB and Bambino Holdings, confirming that Alpha Prema has reached agreement to acquire BayernLB's and Bambino's interests in Formula One Group, has been received with interest," the GPMA said in a statement.
"We look forward to entering into a constructive dialogue with Alpha Prema as we pursue our objective to further develop the sport for the benefit of all stakeholders and in particular the fans.
"Meanwhile, the GPMA and its operating partner iSe will continue the preparations for the New Series."