MAY 18, 2006

An historical note

The Bundesverfassungsgericht, Germany's highest court, has ruled that Thomas and Florian Haffa are guilty of charges of issuing false sales figures for EM.TV company, a company which once owned a 50% stake in the Formula One group.

The Bundesverfassungsgericht, Germany's highest court, has ruled that Thomas and Florian Haffa are guilty of charges of issuing false sales figures for EM.TV company, a company which once owned a 50% stake in the Formula One group. At their trial the two men were alleged to have claimed that EM.TV's revenue for the first half of 2000 had tripled in comparison with the same period a year earlier but prosecutors said that revenues had actually fallen. As a result they were fined a total of $1.6m in 2003.

The Haffa brothers invested $712.5m and $880m in EM.TV shares to buy the Formula One shares in 2001 and then borrowed another $987.5m to buy an additional 25% stake. When they ran out of cash Leo Kirch took over the shares although he also went out of business and so the shareholdings fell into the hands of three banks. They sold their shares in the business to CVC Capital Partners earlier this year.