Jun 25, 2015

    US firm, Qatar eye controlling stake in F1


    RSE Ventures, which owns the Miami Dolphins National Football League team, is joining forces with Qatar to buy a controlling stake in Formula One in a deal worth up to US$8 billion (S$10.8 billion), said a source on Tuesday.

    Aiming to get the sport to break into the United States, sports mogul Stephen Ross and his RSE Ventures is looking to acquire the 35.5 per cent stake from private equity fund CVC Capital Partners, which sold down its holdings from 63 per cent in 2012 in deals that at the time gave the business an enterprise value of US$9.1 billion.

    The commercial side of F1 is run by British billionaire Bernie Ecclestone, who has turned the sport into a global money-spinner in more than four decades of deal-making.

    CVC has twice tried to float F1, most recently in 2013, but the plans stalled and the fund instead sold stakes to US investment groups Blackrock and Waddell & Reed, along with Norway's Norges Bank.

    Dieter Hahn, chairman of the supervisory board of German sports marketing media group Constantin Medien, is also involved in the investment consortium, the source said, adding that investment bank Leonardo is working with him.

    Reuters could not immediately verify what Mr Hahn's precise involvement was.

    "The key to unlocking this deal is that under Bernie, F1 doesn't do much TV rights marketing. Mr Hahn will help with that," the source said.

    F1 has had major challenges to address including soaring costs, struggling teams and failure to engage a younger audience. Team chiefs have said that the sport is close to a crisis as grandstand seats remain increasingly unoccupied and television-viewing figures fall with the races increasingly dominated by a handful of drivers.

    The sport is beset with disputes about governance and fears that traditional races like Monza in Italy face the axe while exotic new destinations are added.

    Qatar is among those seeking a race but, despite its oil and gas wealth, it has so far failed to secure a slot on the calendar, with Ecclestone granting Bahrain an effective veto on regional rivals.

    The Qataris, whose success in securing the 2022 football World Cup has become mired in controversy over the bidding process and alleged corruption within the sport's governing body Fifa, already boast a sizeable presence in motor sport with the MotoGP season-opener.