MARCH 13, 2000

Ecclestone still trading

THERE is considerable speculation in the German press that Bernie Ecclestone has not finished selling shares in his Formula One Holdings empire.

THERE is considerable speculation in the German press that Bernie Ecclestone has not finished selling shares in his FormulaÊOneÊHoldings empire. Although Bernie has now sold 50% of the shares for $1.3bn and raised another $1.4bn by issuing a Eurobond secured with the future revenues of the company, it is thought that he might now agree to sell one more share in the company for several hundred million more dollars if the German media group EM.TV manages to buy out Bernie's current partners. The press reports say that EM.TV is willing to spend $1.8bn to win control of F1 although the payment would probably take the form of shares rather than cash.

The deal sounds rather unlikely as Ecclestone usually never gets involved in companies without controlling them. However if Bernie can negotiate a deal to sell control but to remain running the company for as long as he pleases he will probably do the deal to add to his huge cash pile.

The current excitement over the shares is being caused because investors are beginning to realize the value of Ecclestone's digital television service which can easily be used in other sports. It is expected that within a year or two the infrastructure will be in place to allow Bernie to build a permanent base for the service, rather than having to transport the entire facility from place to place. In the future all the TV signals would be fed back to the permanent base by fibre optic cables. Ecclestone's TV crews would then create programs without having to be at the race tracks. This would save about $40m a year and would mean that other sports could use the facility in between Grand Prix races. There is talk that a deal will soon be reached for the coverage of the 2004 Olympic Games.