Who owns what in F1 these days?

The last couple of years have been rather confusing for F1 fans - at least when it comes to the politics of the sport. Once upon a time there was a team's organization called FOCA and the international automobile federation (FIA) but in recent years there have been all manner of other people involved.

The last couple of years have been rather confusing for F1 fans - at least when it comes to the politics of the sport. Once upon a time there was a team's organization called FOCA and the international automobile federation (FIA) but in recent years there have been all manner of other people involved.

In the early 1990s FOCA gradually came under the complete control of Bernie Ecclestone and was renamed Formula One Promotions and Administration (FOPA) and as he negotiated big new TV deals he became inordinately wealthy, becoming in 1993 the highest wage owner in British history with a salary of $45m, a figure he matched the following year. In 1994 he invested around $40m in a multi-channel digital television system, designed for pay-per-view satellite channels.

After agreement was reached on a new 1998-2001 Concorde Agreement in 1997 Ecclestone quietly restructured his group of Grand Prix-racing related companies in preparation for the flotation of the business. FOPA disappeared and a new holding company called SLEC (SLavica ECclestone) took over a group which had expanded to include several new companies including Formula One Management Ltd., Formula One Communications, Formula One World Travel and others.

The attempt to float the company in late 1997 failed after backers pulled out in the face of an investigation into the company by the European Commission and a dispute between Ecclestone and a rebellion involving several F1 teams over the Concorde Agreement.

By August 1998, however, all the teams had been talked into an agreement to a new Concorde Agreement which would run until the end of 2007. Once this was sorted out Ecclestone, ignoring the Commission investigation, launched a Eurobond issue. This was, in effect, a loan to Ecclestone secured by the future profits generated by the sales of Formula 1 TV rights.

The $1.4bn raised came largely from the German bank Westdeutsche Landesbank although merchant banking firm Morgan Stanley Dean Witter also took some of the bonds. The bond, which is rated by all the major - and highly-influential - rating agencies, was issued by a company called Formula 1 Finance BV and is listed on the Luxembourg Stock Exchange.

The Formula 1 team bosses gained nothing from the Eurobond. Their income from the sale of the F1 TV rights is separate from that earned by SLEC, which currently gets around 52% of the TV money. The teams split the remaining 48% between them. SLEC keeps all the money raised by the negotiations of fees for holding races.

In November 1999 Ecclestone agreed to sell 12.5% of SLEC to Morgan Grenfell Private Equity (MGPE), a subsidiary of Germany's vast Deutsche Bank for $325m. MGPE also signed an option to buy another 37.5% of the company for $975m. MGPE failed to raise the money to take up the option and in February 2000 Ecclestone sold the shares to the venture capital company called Hellman & Friedman. Five weeks later MGPE and Hellman & Friedman pooled their shares into a company called Speed Investment Ltd. and sold the 50% share in SLEC to the German media firm EM.TV & Merchandising for $1.6bn. The EM.TV purchase consisted of $712.5m in cash and 10m EM.TV shares which were then worth around $88 each.

EM.TV, run by Thomas Haffa, said it had an option to buy control of SLEC from Ecclestone. In July 2000 Ecclestone negotiated a deal to secure the commercial rights to F1 for 100 years for a one-off payment to the FIA of something in the region of $315m. This money was then placed in the FIA Foundation and interest on the money will be used to pay for all the FIA's research projects in the years ahead.

In the autumn of 2000 EM.TV suffered a disastrous collapse in its share price (which plummeted from $88 to around $3). Haffa found the company to be under threat and tried to agree a rescue package with Leo Kirch, the man for whom he used to work before establishing EM.TV. Kirch was offered the shares in SLEC and proposed a payment of $550m. This is around half what Haffa paid for them and he was not keen on the deal although he was in no position to argue. The deal was delayed by the fact that Haffa had agreed an option to buy an additional 25% of SLEC for $1bn. These shares were owned by an Ecclestone Family trust company called The Bambino Trust, which Bernie Ecclestone established for his two daughters Tamara and Petra.

After months of negotiating Kirch paid the extra $1bn to enable Speed Investments Ltd. to gain a 75% share of SLEC. Kirch then took control of 77.7% of the shares in Speed Investments Ltd. which equates to 58.3% of SLEC. The Ecclestone Family maintains its 25% share of SLEC and EM.TV (under new management) has the remainder. There is believed to be a shareholders agreement which leaves Bernie Ecclestone to run the company on a day-to-day basis.

Kirch says that it wishes to increase it stake further.

But control of the Formula One group of companies guarantees very little after the end of the current Concorde Agreement in 2007. The Association des Constructeurs Europeens d'Automobiles (ACEA), the European federation of car manufacturers, tried to buy Haffa's shares in SLEC before the Kirch deal was completed. The goal of the ACEA was to get a share of the company and then establish a holding company and sell shares in that to the 12 Formula 1 teams. That idea failed but the car manufacturers are now saying they will start their own World Championship in order to get more back from the sport which they have helped Ecclestone to build up.

That is the story so far.