SEPTEMBER 14, 2003
GPWC meeting at Monza
The GPWC and the banks who own SLEC met on Saturday night at Monza to try to hammer out a deal between the various parties to secure the commercial future of Formula 1. There had been rumors that a deal was close but on Friday afternoon McLaren boss Ron Dennis launched an attack on the banks.
"I do feel we should all try and look to the bigger picture of Grand Prix racing," he said. "The commercial instability that has come as a result of the demise of Kirch is still holding Grand Prix racing back. Three quarters of our business is held by non-interested parties and that is a very negative ingredient in pushing Formula 1 forward. Unfortunately 75% in virtually all businesses constitutes control. There seems to be a complete naivety in all three banks in so much that anybody purchasing shares at that particular time is faced with at least 50 percent loss, purely as a result of the world economy and the dot com bubble burst. And yet they fail even to be able to grasp that very simple economic fact, which makes finding a way forward very difficult when they are just so reluctant to crystallize their loss and turn to the future of Formula 1 and a more practical way to generate an income from their investment.
"They have a non-realistic approach to the future and they are not prepared to sit down and talk about the things that we need to do to address some of the issues in the sport. They are prepared to talk about something that has relevance to them recapturing their lost money, and that is a feeling that is felt by many people both within the governance of our sport and the other commercial partners and the teams as a whole."
The problem appears to be one of money as the banks want more from the car manufacturers than they are currently able to pay for a percentage of the sport. All kinds of deals are currently under discussion including one which would see no money being paid up front but the banks recouping some of their losses from a stock market flotation. There are also believed to be arguments as to how long the next Concorde Agreement should be with the banks trying to get a 20 year deal which some of the teams are not keen on agreeing.
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