So the wheels are in motion to rid F1 of the infinite vacuum that has sucked it dry of every conceivable ounce of profit over the years.
It did so without investing anything to ensure the future of the sport, or to acknowledge those who have continued to support the fast-diminishing asset. Will the new owners of F1 make a difference?
If media reports are to be believed, the answer is yes.
Liberty Media, headed by John C Malone, is a US-based firm that knows more than most about using media to promote sport. The company owns several media and sports companies, including Major League Baseball franchise the Atlanta Braves.
It also has significant holdings in the biggest live entertainment company on the globe, Live Nation, plus Sirius XM Holdings, a satellite radio concern and smaller interests in Viacom and Time Warner.
With the actual cost of the buyout varying in the media, I have to plump for the $8 billion (R114 billion) that most reliable news feeds are agreed upon.
The completion of the transaction is scheduled for the first quarter of 2017, providing all interested parties and organisations, such as the FIA and the European Commission, have no objections.
Initially, Liberty Media will purchase an 18.7% stake for $764 million from the consortium of sellers, headed by CVC Capital Partners. In the new deal, that consortium will hold about 65% of the Formula One Group’s equity.
This allows the sellers board representation plus a representative of CVC joining the Board of Directors of Liberty Media.
Part of the deal results in Liberty Media assuming Formula One’s $4.1 billion debt. On finalisation of the acquisition, the Liberty Media Group will be attributed with ownership and will be retitled the Formula One Group.
The chairman of the group will be Chase Carey, executive vice-president of 21st Century Fox, replacing chairman Peter Brabeck-Letmathe, who will remain as a nonexecutive director.
Bernie Ecclestone has been asked to stay on as Formula One’s CEO for a further three years.
Statements emanating from the Group include one from President and CEO of Liberty Media, Greg Maffei, reported as saying:
“We are excited to become part of Formula One. “We think our long-term perspective
and expertise with media and sports assets will allow us to be good stewards of Formula One, to benefit fans, teams and our shareholders.
“We look forward to working closely with Chase and Bernie to support the next phase of growth for this popular global sport.”
Carey also expressed his views. “I am thrilled to take up the role of chairman of Formula One and have the opportunity to work alongside Bernie, CVC, and the Liberty Media team.
“I admire Formula One as a unique global sports entertainment franchise attracting hundreds of millions of fans each season from all around the world.
“I see great opportunity to help Formula One continue to develop and prosper for the benefit of the sport, fans, teams and investors alike.”
He went on to allay fears about the possible Americanisation of the sport, when he was quoted as saying: “In terms of developing markets, clearly new markets are opportunities as a global sport.
We are excited about that, to grow the sport, expand the sport in places like the Americas and Asia.
“But I want to be clear that the established markets – the home and foundation of Formula 1 is Europe in particular – are of critical importance.
“Building the sport in Europe, building on that foundation, has got to be second to none. We do want to take advantage of the global footprint of this sport, we want to focus on it.”
Carey explained that all teams would be given the opportunity to invest in Formula One.
Apparently, certain teams have already expressed an interest even before terms have been discussed.
So, everything in the garden seems rosy, but time will tell and, on this occasion, I
would prefer to be a
Bringing us down to earth though, was a statement attributed to Ecclestone prior to the deal being concluded.
Ecclestone told Autosport magazine: “I don’t know why anybody criticised CVC because they were shareholders, they weren’t management. They bought the company to make money, and that will be the intention of Liberty.
“They’re not looking at it as a hobby, so it’s no different to CVC.” Let us hope they are less of an asset stripper and more an interested investor.
Back to the “real” business, this weekend the F1 circus heads to Singapore for the 15th round of the 2016 season.
Running under lights creates quite a spectacle, although I am still not convinced the sport needs the gimmick aspect.
Making it available to TV audiences at a reasonable airing time appears to be the reason for such an event.
Once again, we have the usual comments from a few drivers that it’s their favourite track. Odd, as some of those said the same about Spa and Monza.
With the driver’s championship still open to either Lewis Hamilton or Nico Rosberg, and just two points separating them, the real fight will be for third spot, with four drivers in the hunt for glory.
Red Bull’s Daniel Ricciardo sits on 161 points, with Ferrari teammates Sebastian Vettel and Kimi Raikkonen chasing on 143 and 139 points, respectively.
The second Red Bull of Max Verstappen on 121 points will be out to close them down at the Asian street circuit this Sunday.
It just could be an event to remember.