The president of the FIA says any potential buyer for Formula 1 must apply “common sense” following reports a Saudi Arabian fund made a $20 billion (£16.16bn) bid for the sport.A report last week claimed the Saudi Arabian Public Investment Fund made an approach to F1’s owners Liberty Media which was turned down. Liberty Media bought the series from CVC Capital Partners and other stakeholders in 2016, in a deal which valued it at $8 billion (£6bn).
FIA president Mohammed Ben Sulayem warned a $20bn sale price could have negative consequences for the sport.
“As the custodians of motorsport, the FIA, as a non-profit organisation, is cautious about alleged inflated price tags of $20bn being put on F1,” he wrote on social media.
“Any potential buyer is advised to apply common sense, consider the greater good of the sport and come with a clear, sustainable plan – not just a lot of money.
“It is our duty to consider what the future impact will be for promoters in terms of increased hosting fees and other commercial costs, and any adverse impact that it could have on fans.”
Since 2016 the Formula One Group’s stock prices (FWONK) have risen from $18.26 to $69.89.
Dividing lines have emerged between the FIA, which is the governing body of motorsport, and F1. Ben Sulayem recently announced he will begin a process to admit a new team to the series amid interest from Andretti, while F1 CEO Stefano Domenicali has said he sees no need to expand the grid beyond its current 10 teams.
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19 comments on “FIA president warns over ‘inflated $20bn price’ for F1 after reported Saudi interest”
23rd January 2023, 16:15
This person seems to like inserting themselves into other people’s (in this case literal) business.
If they don’t like some other party’s interest in Formula 1, they should get busy putting together a financing package to buy Formula 1 themselves.
23rd January 2023, 16:35
@proesterchen F1 is the FIA’s business. And if F1 is bought by an organisation that needs to recoup the cost by extracting it from hosts and participants, that is a problem and could, eventually, end in F1 having no teams, no races, and a bankrupt owner.
Now it could also be, and in this case that seems more likely, that any potential buyer has no interest in recouping costs through F1 alone, but wishes to use F1 to increase the value of its other assets. Or doesn’t care because it has a near endless money flow from other sources. That’s fair enough, but the FIA has an interest in F1 being a financially healthy series. Not even just for the sake of F1 itself, but for the FIA’s own financial future as well.
23rd January 2023, 19:03
The FIA may hold a minority interest in some of the companies involved with the exploitation of these commercial interests, but they don’t hold a controlling share in any and have no say in transactions changing the ultimate control over these rights.
That’s what happens when you lease your greatest asset for 110+ years in exchange for a pittance.
23rd January 2023, 19:19
As mentioned by MichaelN, F1 is the core business of the FIA who owns the series but leases the commercial rights to FOM because they were forced to do so in 1999 by EU anti-trust commission to avoid any conflict of interest and power abuse.
They don’t have to as the deal with FOM will expire in 2099 and then the F1 ownership will be back to the FIA. Then they only have to relocate the FIA’s headquarter into a non-EU country to get out of the EU legal jurisdiction. They are already thinking about opening an FIA office in Dubai, just in case.
23rd January 2023, 20:35
Perhaps it is time for the “EU anti-trust commission” to tell MBS to pull his head in.
23rd January 2023, 23:20
Just because Mohammed ben Sulayem are the current president of the FIA doesn’t mean the former control the latter’s intellectual property, as that is currently leased to one of Liberty Media’s daughter companies.
So if Mohammed ben Sulayem wanted to control who the commercial rights to Formula 1 belong to and are sold to and at what price, the only way for them to achieve it is to buy said rights themselves.
Alternatively, there’s always the option not to comment on what third parties do with what third parties own or would like to own. Even for Mohammed ben Sulayem.
24th January 2023, 9:27
FIA holds a veto over any potential new owner, so they have a voice.
He may not have a say in any sale price but I don’t have a problem with him pointing out that the only way that money will be recouped is by taking more from the punters (money or rights).
24th January 2023, 10:02
AFAIK, not anymore they don’t. They lost that when Liberty packaged part of its interest in F1 a publicly traded company.
23rd January 2023, 18:27
Where was the FIA during 2021 when Verstappen went into ballistic mode with the blessing of the FIA?
If anything, they legitimized that style of driving and the result.
What on earth happened in 2022 with the overspending? If the sport costs 20 billion, how can a 7 million fine buy you 2 championships?
For 20 billion, you can buy 5,714 championships! The P/C (price to championship) ratio is outrageous!
How do you like that math Christian? ;-)
23rd January 2023, 21:01
Rephrasing toto, it seems Verstappen lives rent free in your head for some years on a row .
Darryn Smith (@darryn)
23rd January 2023, 21:07
This is such a dumb phrase. Almost as dumb as “it is what it is”. Please stop.
23rd January 2023, 20:55
Are you reacting to another story I haven’t read?
Verstappen has stuff all to do with this one.
$20 billion is a figure the Saudi’s offered, and Liberty Media said no. At a guess, they started with a lower figure and jacked it up many times trying to find a figure that Liberty Media couldn’t refuse.
Maybe Liberty do have principles or just think the business case for keeping the known bird in the hand is better than that for the speculative two in the bush. After all, what they have has a revenue value as well as a capital value. Selling the capital asset on a rising market isn’t good business.
23rd January 2023, 21:02
Why couldn’t the Saudi’s just buy up stock? Is there a preferred stock tranche that has controlling voting interest? Not that I’d want them to own FOM but that would seem, (to naive me) a route to ownership……
23rd January 2023, 21:52
Verstappen has nothing to do with this story, there are other (MANY) topics in the Internet ( British newspapers) where you can go with this, you will be in good company.
24th January 2023, 5:57
Liberty still didn’t made a return on their initial 7 billion investment without mentioning the amount of money they have invested into modernizing the sport (digital transformation) and the share of money they have gave up from the annual prize money for more fair prize distribution between the teams. The reason that they didn’t sell is that their financial analysts have forecasted a solid financial stability in the near future.
23rd January 2023, 21:19
Ben Sulayem keeps making unguarded comments about F1. I wonder if he was truly a good choice for the sport
24th January 2023, 1:02
The FIA is more than just F1. It’s much more than just motorsport….
24th January 2023, 1:07
The 20bn reference is old news from last year to my knowledge, but he’s right.
24th January 2023, 14:44
Good to know if there is Johnny from Memphis who has the money can’t just buy part of F1 just for fun
Comments are closed.