3 Min Read
By Keith Weir
LONDON, Nov 19 (Reuters) - Plans for a stock market flotation of Formula One motor racing remain stalled, its top shareholder said on Tuesday, as F1's chief executive Bernie Ecclestone faces legal action that could break his long grip on the sport.
Private equity fund CVC said a flotation was still its aim, but ruled out any action in the short term to revive plans for a listing.
"One day we'd like to float the company," CVC co-chairman Donald Mackenzie told reporters as he left court after giving evidence in a damages case involving Ecclestone. "We've got no plans to do that in the imminent future."
CVC has a 35.5 percent stake in F1 having sold down its holding from 63 percent last year.
CVC put off plans to float Formula One in Singapore in the middle of last year because of market turmoil. Instead, it brought in new investors in the form of U.S. investment groups Blackrock and Waddell & Reed, along with Norway's Norges Bank, in deals that gave the business an enterprise value of $9.1 billion.
A flotation would be difficult to achieve until there is greater clarity over the legal cases involving Ecclestone, the 83-year-old Briton who has built the business into a global money-spinner over the past four decades.
Mackenzie told the court on Monday that CVC would fire Ecclestone if he was found to have committed a crime in his dealings with a jailed German banker.
"We'd prefer not to have these cases," Mackenzie said. "We like being a shareholder in Formula One."
Ecclestone is facing a $100 million damages claim over allegations he undervalued the business in 2005 when CVC acquired a controlling shareholding from Germany's BayernLB and other banks. He is accused of favouring a deal with CVC as it planned to keep him on as chief executive.
A Munich court jailed Gerhard Gribkowsky, former chief risk officer at BayernLB, for 8-1/2 years in 2012 over a $44 million payment made by Ecclestone and an Ecclestone family trust after the CVC deal.
Ecclestone told the London court this month that he paid Gribkowsky around 10 million pounds ($16.1 million) because the banker had threatened to make false claims about his tax status that could have cost him as much as $2 billion.
The German authorities are due to decide next year whether to put Ecclestone on trial for bribery over the payment. Ecclestone denies any wrongdoing.