Qatari-US Group Looks To Snag Formula One for $8.5 Billion

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The Financial Times is reporting that the owners of Formula One motor racing are very close to a deal with a US-Qatari group led by Stephen Ross, the 75-year-old owner of the NFL’s Miami Dolphins. According to two sources close to the negotiations who spoke to FT, the group led by Ross and CVC, the private equity group with a controlling 35.5% stake in Formul

a One, have “shaken hands” on a tentative deal.


More on deal to sell Formula One racing

“We are well along the way,” one member of the acquiring group noted.

FT reporters Malcolm Moore and Arash Massoudi point out, however, that Ross’s group has only recently started due diligence, and has to raise additional funds. “They are doing due diligence now and everything could still fall apart,” noted one knowledgeable source. He would only say he thought there was a good chance of some kind of deal within 30 days.

It is generally agreed that the sale of F1 has been difficult in the past because of the complex organizational structure of the motor racing firm. Related to this,  several earlier negotiations to sell Formula One to other parties by CVC over the years have not materialized, nor have efforts to launch a public listing of the company.

CVC and representatives for the acquiring group would not comment on the record. “There is no deal, handshake or otherwise,” one source close to CVC noted.

Also of note, minority investors in F1, such as Waddell & Reed, Norges Bank Investment Management and BlackRock, refused comment.

If the Ross consortium nails down a deal, Formula One would be controlled by his holding company RSE Ventures. Of interest, investors in the acquiring group include Qatar Sports Investments, the owners of the Paris Saint-Germain football club; Constantin Medien, the German media firm; and a wealthy backer from China.

The sources also highlight that close to 50% of F1’s $8.5 billion total enterprise value is debt.

Although Ecclestome has publicly said he plans to sell his stake in Formula One in a deal, sources close to Ross say that he would like to see Ecclestone stay in charge of day-to-day operations and event planning.

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