Liberty Media to Acquire Formula One for $4.4 Billion
http://www.bloomberg.com/news/articles/ ... -cnbc-says
John Malone’s Liberty Media Corp. agreed to buy the company that controls Formula One from private-equity firm CVC Capital Partners Ltd. for $4.4 billion in cash, stock and convertible debt, CNBC reported.
Liberty will hold an 18.7 percent stake in Formula 1 parent Delta Topco right away and will take full ownership as soon as the end of March, the TV network Wednesday, citing an announcement from the companies. London-based CVC, largest shareholder in Delta Topco, will own 65 percent of Liberty Media Group, a unit of Liberty Media Corp., after the transaction, CNBC said. Malone will retain control of the company through voting shares, the news outlet said.
Chase Carey, a former top executive at Rupert Murdoch’s media empire, will become chairman of Liberty Media Group, which will change its name to Formula One Group, CNBC said.
The deal reflects a push by media companies to secure popular programming at a time when TV faces increasing competition from digital alternatives. Broadcasters and advertisers prize sports events like Formula One and English Premier League soccer because they continue to draw large live viewing audiences and have a growing global following.
While Formula One has struggled to crack the U.S. market, it generated $1.3 billion from television rights and other revenue sources including race-hosting fees in 2014, the most recent year available, according to filings at the U.K.’s Companies House. Liberty Global Plc, a London-listed sister company to Liberty Media, owns cable operator Virgin Media in the U.K. and other broadband and TV providers.
The deal would provide a windfall for CVC, which bought control of Formula One from lenders in 2006 for $2 billion and later sold stakes to BlackRock Inc. and Waddell & Reed Financial Inc.
Bernie Ecclestone, the British entrepreneur who founded Formula One in 1978 and built a global following through the sale of lucrative TV and advertising deals linked to Grand Prix races in dozens of countries, will remain chief executive officer, CNBC said.
Around the time of the 2006 sale, Ecclestone quelled a threat from Formula One teams to set up a rival car-racing series and his management involvement has continued since the CVC takeover.