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MARCH 15, 2006

Ecclestone looks at Ferrari

There have been reports that Bernie Ecclestone is considering buying a share in the Ferrari company. Fiat owns 56% of Ferrari and thus remains in control but banks now own much of the rest, although Piero Ferrari still holds 10% of the business. Commerzbank in Germany owns 12.5%, Lehmann Brothers owns 6.5% and Mubadala, an investment group run by the Abu Dhabi royal family, owns 5%. This last-named deal valued Ferrari at $2.78bn in August 2005. Mediobanca holds 10% but rumours in Italy suggest that Ecclestone may be buying these shares, which would cost at least $278m, based on last year's valuation. Mediobanca bought 34% of the company in 2002 for $768m.

Ecclestone can no doubt afford it but this does not mean that a deal will go ahead as such an arrangement is likely to attract the attention of competition authorities as it may be seen as being a clash of interest. Having said that, if Ecclestone does become a minority shareholder in Alpha Prema, the company that is buying F1, it may be possible for him to hold Ferrari shares as well.