Politician calls for inquiry over F1 sale

Uh- oh. It all seemed to go a little too smoothly, didn’t it? Bernie Ecclestone mightn’t be cackling all the way to the bank just yet, after having sold a stake in Formula 1 to US- based Liberty Media.

The deal is under extra scrutiny after a British politician has called on anti- trust authorities to launch an investigation into F1’ s sale, alleging a potential conflict of interest in the deal with the sport’s governing body, the Federation Internationale de l’Automobile ( FIA) itself.

The concern comes from MP Anneliese Dodds, who has been investigating allegations of anticompetition in F1 for two years since the collapse of the Marussia and Caterham F1 teams, which were both based in her region.

Dodds’ red flag surrounds the FIA’s 1 per cent stake in F1’ s parent company Delta Topco.

In 2013, the company, which is controlled by the investment fund CVC, sold the 1 per cent stake to the FIA for the bargain- basement price of US$ 458,197 ($ 628,728). That 1 per cent is now worth a cool US$ 44 million.

But it can only be cashed in when CVC sells its 38.1 per cent stake in Delta Topco. And in order for the sale to go ahead, the FIA’s consent is required.

In other words, if the FIA approves the sale of F1, it will instantly make a US$ 44 million profit.

Dodds has taken the matter to the European Commission, which already has complaints about FIA conduct and biased decisionmaking on its desk from the Sauber and Force India race teams.

So it looks like there is a fair bit of red tape to argue over before the cigar sellers of Paris celebrate an upturn in business with an FIA profit share of F1’ s sale. One wonders whether Liberty Media knew they were getting into such a mess. One thing seems certain though; Bernie will still come out on top, regardless.