SEPTEMBER 6, 2002
Formula 1 and the banks
There have been stories in Germany that the creditor banks involved in the Kirch debacle have to get European Commission clearance before being allowed to appoint a new board of directors for SLEC, the company which controls the Formula One group of companies and which controls the commercial rights to Formula 1.
This is not correct. The banks appointed directors some time ago and, according to our sources, they know exactly what is going on in the company.
The interesting question is who would benefit from such a story circulating in financial circles. One cannot help but wonder if it is not a strange coincidence that the story coincides with the German election campaign. The impression given is that the bankers do not know the details of the Kirch loans which involved the Bavarian state bank, which was controlled by election candidate Edmund Stoiber. If questions began to be asked there could be some embarrassment for Stoiber - and obviously someone does not want that to happen.
The truth is that the only block that currently exists for the banks to take over the commercial side of the sport is whether or not the FIA is willing to accept them as the holder of the commercial rights. The FIA's contract allows the federation to cancel any deal if it does not like those who control the rights...
It is not clear whether the FIA likes the banks or not.