Last Updated September 8, 2016 18:00BST
The US media firm Liberty Media has confirmed they are buying formula one for £3.3bn subject to regulators approving the deal. The announcement ends years of speculation about the ownership of the company.
Berine Ecclestone will remain as chief executive but Chase Carey, vice-chairman of 21st Century Fox, will become the new chairman. Liberty has stakes in several sports and entertainment businesses, including the Atlanta Braves Major League Baseball club.
First the group owns by John Malone will take a minority stake and if regulators approve the deal a full takeover will happen with the total transaction values the firm at $8bn but includes $4.1bn worth of F1’s debt.
Liberty Media is buying the stake from the private equity firm CVC Capital. CVC has held a stake for the past decade but sold some of its holding in 2012.
Caret “I greatly 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.”
The sport will require FIA, UK, EU and US regulators to approve the remaining 81.3% of the takeover deal as the UK where Formula One is based. This will be required as the UK remains a member of the EU despite the Brexit referendum in June.
The deal will allow the teams to buy there own shares in the sport for the first time. With Liberty saying the teams “will be given the opportunity to participate in the investment”, adding that some had expressed interest.
A spokesman for McLaren told the BBC “It is obviously a significant development, which has only just occurred, but from what we already understand we are confident that it will be a positive step for Formula 1.”
The key points that liberty want to address are
- Increase promotion and marketing of F1 as a sport and brand
- Enhance distribution of content, especially in digital
- Establish broader range of commercial partners, including sponsorship
- Evolve race calendar
- Leverage Liberty’s expertise in live events and digital monetisation
Formula One faces many challenges both in Europe and Americas with falling TV viewers and the move towards pay TV. Also, the sports failing to embrace new digital media, marketing. The main issues are the decline in appeal among younger audiences in an ultra-competitive sporting landscape, the rising costs to teams, fans and circuits, and the predictability of races.
Ecclestone said earlier this week he had been asked to stay on for three years and would miss the Singapore Grand Prix on 18 September as he needed be in London for the negotiations.
