Liberty Media Acquires MotoGP and Formula 1 Racing for $4.4 Billion

Liberty Media Acquires MotoGP and Formula 1 Racing for $4.4 Billion
Motorcycling - Moto2 - Japanese Grand Prix - Suzuka Circuit, Suzuka, Japan - September 25, 2022 General view during the race REUTERS/Issei Kato/File Photo Purchase Licensing Rights

Liberty Media Acquires MotoGP and Formula 1 Racing for $4.4 Billion


Key Takeaways

  • Liberty Media secures majority stake in Dorna Sports, the commercial rights holder of MotoGP, for $4.4 billion.
  • Deal to be completed by year-end 2024, subject to regulatory approvals.
  • Acquisition expected to expand racing schedule, media platforms, and marketing partnerships, enhancing MotoGP’s global presence.

 

Liberty Media, the owner of Formula 1, has acquired a majority stake in Dorna Sports, the commercial rights holder of the motorcycle racing circuit MotoGP. This deal, valued at €4.2 billion ($4.5 billion), puts the enterprise value of Dorna Sports at €3.5 billion ($3.8 billion).

The acquisition is expected to be completed by year-end 2024, subject to the approval of competition and foreign investment law authorities in various jurisdictions.

Dorna Sports is based in Madrid, Spain, and promotes a range of competitions, including the Superbike World Championship and the electric biking series MotoE.

The company is currently owned by Bridgepoint Capital, a UK-based financial firm, and the Canada Pension Plan (CPP) Investments. Dorna Sports’ long-time CEO, Carmelo Ezpeleta, will continue to lead the company under Liberty Media’s ownership.

Liberty Media plans to attribute MotoGP to its Formula One Group tracking stock and pay for the business with approximately 65 percent in cash and 21 percent in shares of Liberty Formula One common stock.

The company expects the existing debt balance at MotoGP to remain in place after the acquisition.

The deal for Dorna Sports, according to Reuters comes after other companies, including TKO Group and Qatar Sports Investments, reportedly looked into a possible takeover. However, Liberty Media emerged as the successful bidder for the company.

The acquisition of Dorna Sports is expected to help Liberty Media expand its racing schedule and take the circuit to additional media platforms, including an increased social media presence and the Netflix reality series “Drive to Survive.”

The company has also focused on expanding marketing partners, including a promotional partnership with streaming service Paramount+.

The deal is expected to face regulatory hurdles, according to the Financial Times.

Private equity firm CVC Capital Partners previously attempted to own both Formula One and MotoGP, but had to sell the latter in 2006 in order to gain approval from European Union competition regulators for the purchase of Formula One.

Liberty Media’s CEO, Greg Maffei, expressed excitement about the acquisition, stating that MotoGP has a “loyal, enthusiastic fan base, captivating racing, and a highly cash flow generative financial profile.”

He added that the business has significant upside, and that Liberty Media intends to grow the sport for MotoGP fans, teams, commercial partners, and shareholders.

Ezpeleta also expressed enthusiasm for the deal, stating that it is the “perfect next step in the evolution of MotoGP.”

He believes that the acquisition will bring significant benefits to Dorna, the MotoGP paddock, and racing fans.

Overall, the acquisition of Dorna Sports by Liberty Media is a major development in the world of motorcycle racing.

The deal is expected to bring significant benefits to both companies, as well as to fans of MotoGP around the world.

Leave a Reply

Your email address will not be published. Required fields are marked *