Formula 1’s owners Liberty Media believe the sport is worth in excess of $20 billion (£15.7bn).
The growth in popularity has added major value to Formula 1 as an asset for Liberty. Earlier this year, reports suggested that the Saudi Arabian Public Investment Fund (PIF) had explored a potential buyout of the sport for a reported figure of $20 billion, but Liberty Media were said to have expressed they had no interest in selling the sport at present.
However Liberty Media CEO Greg Maffei has denied the Saudi PIF had made an approach about potentially purchasing F1.
“The Saudis have been partners on a couple of things – they have a race, Aramco [state-owned petroleum company] is a sponsor – but they never approached us,” Maffei told the Walker Webcast.
“And frankly, $20 billion would not be an attractive price. It’s trading for $17 billion, $18 billion – why 20? I’d want a hell of a lot more than that. We’re pretty bullish on the future.”
Maffei says that the current structure of Liberty Media and how it operates with Formula 1 under its ownership would dissuade the company from considering selling the sport at this time.
“We’re a C-corp, meaning if we sell a division, we pay corporate-level tax and then any proceeds we would pay that get distributed to our shareholders, they would, in addition, pay tax,” Maffei explained.
“If we were to spin Formula 1 away, create a separate company, wait a sufficient time, have no plan or intent to sell, that asset could be sold down the road and there would be no corporate-level tax. So what I really was saying is the way we’re structured today, given that low-tax basis, we would not be sellers.
“If we wish to be sellers or even consider it right, you’d need to do a spin. And spinning it away, there are other reasons why we might do that – it’s not just to do a sale. But the way we are structured, that would be very unattractive.”
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Despite the current domination of Red Bull and Max Verstappen leading to a lack of an intriguing battle at the very front of the field, Maffei points to the intense competition behind Red Bull as evidence that their efforts to improve entertainment for the sport’s fans is having success.
“While Max is up front, we can show you statistically there is actually way more overtaking going on in the midfield over historical numbers,” he said.
“We can show you how many overtakes there were – I think there were 77, not in Montreal, but the week before in Spain, which is a big number. We track this. We are trying to create an interesting product for our fans, obviously.
“Formula 1 has had a long time when teams and cars had a run. You go back, Red Bull had won four in a row, then Mercedes won eight in a row – seven with Lewis [Hamilton], one with Nico Rosberg – and now it looks like we may have our third for Red Bull. So it’s not unusual. I think it takes a while for teams to catch up to some of these new regulations.”
Maffei also says that Liberty have been “blessed” to have owned the sport during a period when three of the most successful drivers in history – Lewis Hamilton, Sebastian Vettel and Verstappen – had all been competing on the same track.
“It’s clear Max is an incredibly focussed individual. Aggressive, smart, capable. Training all the time, thinking all the time,” he said. “And Lewis is too. Great skills.
“It’s always very tough to know how much is the car in Formula 1, how much is the team – because it’s a team. There are a huge amount of resources backing them up. Strategic decisions about tyre changes and lots of other things that are the team, tyre choices. And then how much is the driver? Weighing all that is hard.
“But clearly we’re blessed to have, in the era where Liberty’s been involved, three of the greatest of all time.”
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