Liberty sells $825m stake in Formula One to acquire MotoGP

©MotoGP

Formula One’s parent company, Liberty Media, has announced a public offering of 10,650,000 shares of its Series C Liberty Formula One Common Stock to raise $825 million, primarily to finance its acquisition of MotoGP.

The public offering, priced at $77.50 per share, will generate the necessary capital to complete the $4.2 billion all-cash deal for Dorna Sports, the company that owns and operates MotoGP.

In addition to funding the acquisition, a portion of the proceeds will be allocated for corporate purposes, including debt repayment.

Liberty Media has also granted the underwriter of the offering – Goldman Sachs & Co – an option to purchase an additional 1,597,500 shares.

Liberty’s take-over of MotoGP was announced earlier this year in April and valued at $4.2 billion. Its acquisition represents an 86% stake in Dorna Sports, while the remaining 14% will remain with MotoGP’s management.

The move marks a significant step in Liberty’s strategy to expand its portfolio of live sports and entertainment assets.

Read also: Hamilton responds to rumors of MotoGP team ownership deal

Earlier this month, Liberty Media CEO Greg Maffei revealed in a conference call with Wall Street analysts that the company expects its transaction with Dorna to close before the end of the year.

“The transaction is progressing well,” Maffei revealed. “Regulatory filings are progressing on track.

“We've received foreign investment control clearance in both jurisdictions needed, Italy in Spain, and we recently received merger clearance in Brazil and Australia.

“We continue to expect the transaction to close by year-end.”

©MotoGP

Liberty’s acquisition of Dorna has inevitably fueled speculation about a potential groundbreaking collaboration between F1 and MotoGP and the organization of a double bill race weekend.

While logistical hurdles abound – coordinating at the same venue two major racing series with vastly different technical needs and safety considerations would be a complex undertaking – long-standing Dorna CEO Carmelo Ezpeleta hasn't entirely ruled out the idea.

Earlier this year, MotoGP’s supremo even confirmed that discussions were underway with his F1 counterpart, Stefano Domenicali, to "study the possibility."

Dorna is not just responsible for MotoGP. The company also holds the commercial rights for the World Superbike Championship and the all-electric MotoE class.

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Phillip van Osten

Motor racing was a backdrop from the outset in Phillip van Osten's life. Born in Southern California, Phillip grew up with the sights and sounds of fast cars thanks to his father, Dick van Osten, an editor and writer for Auto Speed and Sport and Motor Trend. Phillip's passion for racing grew even more when his family moved to Europe and he became acquainted with the extraordinary world of Grand Prix racing. He was an early contributor to the monthly French F1i Magazine, often providing a historic or business perspective on Formula 1's affairs. In 2012, he co-authored along with fellow journalist Pierre Van Vliet the English-language adaptation of a limited edition book devoted to the great Belgian driver Jacky Ickx. He also authored "The American Legacy in Formula 1", a book which recounts the trials and tribulations of American drivers in Grand Prix racing. Phillip is also a commentator for Belgian broadcaster Be.TV for the US Indycar series.