Fund director Yngve Slyngstad told the business daily Dagens Naeringsliv that
the deal remains within the mandate of the fund because “the intention is
still to list the company quickly when it is possible to do so.” However he
admitted that Norges “have made a mistake” and may try to offload its stake.
“They are right. They are not allowed to buy private companies,” says Mr
Ecclestone. It has already been a lucrative investment as Norges scooped up
$93m from a dividend in 2012 and its stake is understood to be worth around
$100m more than it paid for it.
Despite the bribery scandal engulfing the sport it is nearly 18 months since
an F1 stake changed hands. Its third biggest shareholder, the estate of
collapsed investment bank Lehman Brothers, has filed documents which
indicate that it may have to sell its 12.3pc holding by 30 June this year to
pay its creditors. However, a source close to CVC suggests that it wants to
retain it for longer as its value is accelerating.
F1’s revenues have increased by 31.7pc over the past five years to $1.6bn with
net profits of $378m.
“Lehman had the opportunity to sell lots of times,” says Mr Ecclestone. “Lots
of people tried to buy those shares and they won’t sell. Maybe they would
sell at an over-rated price. The obvious thing is for them to sell along
with CVC too.”
CVC has right of first refusal if any of F1’s minority shareholders want to
sell. It is understood to have held early stage talks with American media
mogul John Malone’s Liberty Global which has teamed up with Discovery
Communications to consider a takeover of Delta Topco.
F1 is one of CVC’s most profitable assets. It has already generated a return
of more than 350% from CVC’s initial $2bn investment which was funded with
$1.1bn of debt from the Royal Bank of Scotland.