Sil­ver­lake and IMG look to buy F1 share­hold­ing

F1 Racing (UK) - - INSIDER -

High price tag has put off pre­vi­ous po­ten­tial in­vestors, but the con­sor­tium are al­ready in dis­cus­sion with ma­jor­ity owner CVC

Amer­i­can tech­nol­ogy in­vest­ment group Sil­ver­lake and sports mar­ket­ing gi­ant IMG are to­gether look­ing to buy a ma­jor share­hold­ing in For­mula 1. Se­nior sources say the con­sor­tium is in talks with con­trol­ling share­holder CVC about an F1 in­volve­ment, but that an agree­ment has yet to be reached.

The two are the lat­est in a long list of po­ten­tial in­vestors in the sport’s com­mer­cial rights, and it re­mains to be seen whether their in­ter­est be­comes more con­crete than other bid­ders whose in­ter­est has come to noth­ing.

The stum­bling block in any deal has typ­i­cally been the val­u­a­tion of the sport, which CVC puts at $8bn. There is also un­cer­tainty over F1’s fu­ture, notably about the fact that the teams’ con­tracts run out at the end of 2020, with the ex­cep­tion of Re­nault’s, which runs un­til 2024.

Sources say CVC chair­man Don­ald Macken­zie is keen to stay in­volved in F1 no mat­ter what hap­pens to share­hold­ings. And F1 boss Bernie Bernie Ec­cle­stone (left) and Don­ald Macken­zie (right) are both keen to re­main in­volved in F1

Ec­cle­stone is said to be “look­ing very strong in the sad­dle”, ac­cord­ing to one se­nior in­sider.

That is not a re­flec­tion of the power he has to make changes to sport­ing and tech­ni­cal reg­u­la­tions – where Mercedes and Fer­rari cur­rently have a stran­gle­hold on de­ci­sion­mak­ing, as ev­i­denced by Ec­cle­stone’s in­abil­ity to kill off hy­brid en­gines. It is rather a state­ment of the se­cu­rity of his po­si­tion as CEO of the F1 Group, which has been strength­ened by fi­nan­cial per­for­mance.

Ec­cle­stone has in re­cent months con­cluded a lu­cra­tive new tyre-sup­ply deal with Pirelli, a huge new cor­po­rate spon­sor­ship deal with Heineken, plus a new TV deal with Sky in the UK worth a £1bn over six years. And his lat­est ad­di­tion to the cal­en­dar, the race in Azer­bai­jan, is said to be worth $70m a year.

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