Friday, 24 June 2011

News Corp's bid for Formula 1: talks continue

(Agencies) In early April News Corp was in the early stages of exploring a potential takeover bid for Formula One motor racing, and were in preliminary talks with Mexican billionaire Carlos Slim, the world's richest man, about forming a consortium. Sources connected to at least one of F1's big car manufacturers (rumours say Fiat/Ferrari, but these are unconfirmed) had also been in talks with News Corp in recent weeks, apparently. The creation of a consortium that would buy F1 is understood to be only one of several options that News Corp is examining. It may decide not to attempt to acquire a direct stake in F1's owner but instead bid for the broadcast rights, sources reported. Formula One is currently owned by CVC Capital Partners, a big private equity firm that acquired the sport between 2005 and 2006, but it says that there are no firm plans to sell F1. CVC Capital Partners bought F1 in a series of deals from a group of banks and F1 chief Bernie Ecclestone's family trust.>>>

News Corp's discussions were at a very early stage and there was no guarantee it would come forward with a bid although it was interesting that the New York-based media group would even be looking at the opportunity at a time when many people connected with F1 believe it will come up for sale in the next year or so. It is also believed that News Corp is unluikely to make a solo bid, which would explain those conversations with Carlos Slim.

In any case, if the Murdoch company did not offer to buy F1 franchise outright, it could well go for just the broadcast rights, in itself probably the more lucrative part of a deal. Wall Street bank JP Morgan is advising the group on the situation.

News Corp is currently in the process of trying to secure approval to buy the shares in Sky News owner BSkyB that it does not already own.

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