F1 sale…will it happen?

Statue of Liberty

The sale of Formula 1 to US giant Liberty Media has been somewhat of a talking point over the last few weeks but recent news suggests it could have hit a little bit of a problem down to some complex issues involving shares.

Liberty Media

For many of us in the UK the name Liberty Media doesn’t really mean a great deal and nor does the name of its owner John Malone but it is a company that is involved is a number of very familiar things. Liberty owns stakes in ITV, the production company that created TOWIE and Midsomer Murders as well as Virgin Media and much more. John Malone is sometimes known as Darth Vader because of the ruthless way he does business but what business person isn’t ruthless? The upshot is that Liberty are pushing hard to buy F1 and it will be their largest single investment to date.

Delta Topco

Currently F1 is ultimately owned by a company called Delta Topco but Bernie Ecclestone and other investment groups own substantial shares too. Delta Topco has owned F1 for the last 10 years and has made a substantial amount of money from the sport as have other investors. In 2015 it was cited that F1 made more than FIFA which is quite an accolade.

The Potential Issue

The deal initially seemed a simple one, at least from the outside; one large US company buying F1 from another large US company. However, it is not quite that simple. The problem has arisen from the fact that the FIA (F1’s governing body) happens to own a stake in Delta Topco. This may seem fairly normal and it is but if DT sells to Liberty then the FIA stand to make a rather huge some of money. It is this potential profit that is making certain people feel a little uncomfortable.

It is claimed that the idea of the overseeing governing body is to be impartial and unbiased throughout any action relating to the sport and any involvement in a deal to change the sport and make money is a conflict of interest. These are not the feelings of everyone involved and there is a counter argument saying that the extra money would be made at the point of the deal and then it would have no further impact. After all, why would the profit made have any effect on the racing rules, safety or any other aspect of the actual sport?

Ultimately only time will tell if the deals goes through but there are a lot of very interesting aspects to the Liberty take over that could really push F1 forward in a number of ways. However, as with all sport and business it is important to make sure all deals are fair.

As a company we provide fire extinguisher systems for the full range of motorsport from track days and historic racing to F1 cars so get in touch to find out about the full range of systems we offer.



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