WILMETTE, Ill. — As racing enters the final laps of the season, action off the track continues at high speed.
In this month’s The Business of Speed, we’ll examine Formula 1 and the business activities of its parent company — Liberty Media.
In late 2016, Liberty Media entered into an agreement to acquire Formula 1. The primary selling shareholders were CVC Capital Partners. This private equity group had owned their position for about 10 years, which is twice as long as a typical holding period.
When the Liberty Media/Formula 1 deal closed, it had an enterprise value of $8 billion. It was financed through a combination of cash, debt and equity. At the time (January 2017), there was a stock offering under the ticker symbol of FOWNK at $25 per share.
Over the last seven years, FWONK could be viewed in two periods. Stage one (2017-2020): the stock price ranged between $30 to $45 per share. Stage two (2020-2024): the pandemic shutdown to now, it has climbed steadily to the $65 to $75 range.
During its ownership of Formula 1, Liberty Media has transformed its business operations – adding to the race calendar, bringing on commercial partners, hiring a new management team, expanding the media footprint and engaging the fan base. This led to rising revenues and increased profitability.
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