F1 owner is close to agreement to buy MotoGP – 03/27/2024 – Sport

F1 owner Liberty Media is in exclusive talks to buy the company that owns MotoGP for more than 4 billion euros (R$21.5 billion), in a deal that would unite the elite car and motorcycle racing series , according to people familiar with the matter.

Liberty, which is chaired by telecommunications and entertainment billionaire John Malone, is poised to agree to the acquisition of Dorna Sports after fending off a rival bid from TKO, the sports and entertainment group run by Hollywood powerbroker Ari Emanuel .

Qatar Sports Investments, a group backed by the State of Qatar and owner of French football club Paris Saint-Germain, has also expressed an interest in Dorna and has held talks with its owner, Bridgepoint, the private equity firm.

Madrid-based Dorna represents a rare opportunity to enter a global sport with lucrative commercial rights. Dorna promotes several competitions, including the Superbike World Championship and an electric cycling series called MotoE. It organizes 251 races per year in 20 countries.

Any deal, however, will likely face regulatory scrutiny. Private equity firm CVC Capital Partners previously owned F1 and MotoGP, but was forced to sell the motorcycle series in 2006 as a condition of buying F1 after European Union competition regulators raised concerns. CVC sold F1 to Liberty in 2017, in a deal worth US$8 billion (R$39 billion, at current prices).

James Killick, competition lawyer at White & Case, said the history of F1 and MotoGP and the size of a potential combined group made competition investigations “quite likely” both in countries such as the UK and Germany, as at the European Union level.

“I would be very surprised if competition regulators didn’t look at this,” he said. “The question is: has the market changed?”

Bridgepoint and the Canada Pension Plan Investment Board are Dorna’s main shareholders. Dorna management, including executive chairman Carmelo Ezpeleta, is also a shareholder. Ezpeleta has led Dorna for 30 years, repeating the way Bernie Ecclestone dominated F1 for decades.

Bridgepoint, CPPIB, Dorna, Liberty Media, F1, TKO and QSI declined to comment.

Liberty’s offer values ​​Dorna at more than 4 billion euros, including debt. An agreement is close, but an announcement could be delayed until next week.

Buying MotoGP would give Liberty Media, led by chief executive Greg Maffei, the chance to prove that its success in growing F1’s popularity was not a one-off.

Like F1, MotoGP’s business model revolves around broadcasting rights, race circuit fees, sponsorship, corporate hospitality and merchandising.

Under Liberty, F1 prioritized promoting the sport on social media and gave Netflix unprecedented access to make the “Drive to Survive” reality show.

The program focused on drivers, team managers and owners and was cited as a reason for the sport’s increased fan base. Liberty took F1 to Miami, Las Vegas, Jeddah and Doha, expanding the calendar to a record 24 races this year.

F1’s operating profit increased 64% to US$392 million (R$1.9 billion at current exchange rates) in 2023, compared to the previous year, as revenues rose from US$2.5 billion (R$ $12.4 billion) to US$3.2 billion (R$15.9 billion). Dorna’s revenues totaled 483 million euros (R$2.6 billion) in 2023.

Bridgepoint, which has been a shareholder in Dorna for 18 years, holds around 40% of the business that it purchased for an enterprise value of 550 million euros (R$2.9 billion, at current prices) in 2006. CPPIB bought it from Bridgepoint its 39% stake in Dorna in 2012.