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GP Week : Issue 146
Last week, the big financial story in F1 was the future sale of the Lehman Brothers’ 15.3 percent stake in Formula One holding company Delta Topco. This week, it’s the partial floatation of the sport in Singapore. CVC Capital Partners are thought to be considering floating a 15 percent stake in Formula One, and have reportedly engaged Goldman Sachs to assess the viability of a flotation. Singapore has been chosen as a likely venue for the IPO (initial public offering). Officially, Singapore has been selected because of Formula One’s growing importance in the Far East. But transparency requirements for floatation on the Singapore Exchange are considered to be less stringent than at other high- profile bourses. As a consequence, the more complex aspects of F1 financing would not be fully revealed. Inside the paddock, reactions to the news were mixed. “I don’t think it will benefit us as a team,” Martin Whitmarsh said on Friday. “I don’t think, but again I have no detail of proposals anyway. But generally floatations and change of ownership aren’t done for the benefit of a sport. “I think what us as race teams need to concentrate on is putting a show on here and clearly the owners can decide what they do with the asset.” Gerard Lopez, who made his money as a venture capitalist, commented on the proposed flotation from a business point of view. “There are no details out there and floatation can mean many things,” he said. “If you take to the market a minority share it doesn’t change anything in ownership, it gives more liquidity to the owners, maybe more money to the sport, so as long as there are no details on what might by IPO’d or not, I don’t think there is much to be discussed because it can mean many, many things to many people. It really depends on what you’re going to take to the market. “As far as Formula One goes, it might have made sense if all the Formula One teams could afford it,” Lopez continued. “If they all became shareholders in some form or fashion – but that’s not going to happen – so as far as investing in Formula One, I think it then becomes purely a financial position and then it falls out of the sport. It’s like if someone wants to invest or not. It’s like any other stuff.” Asked at the Friday press conference whether they had considered investing in the IPO, none of the team representatives present – from Caterham, Ferrari, Lotus, McLaren, Red Bull, and Sauber – showed any interest. A BUSINESS IDEA WORTH FLOATING - the F1 IPO 5 GPWEEK.com // PARTNERS: F1 >>> NEWS