Formula 1 teams snub shares offered by Liberty Media

Liberty Media Formula 1

Liberty Media Corporation announced that the investment opportunity offered to Formula 1 teams to purchase up to approximately 19 million shares of Series C Formula One common stock has expired.

The Formula 1 teams were offered the opportunity to invest at a per share purchase price of $21.26 at the time of Liberty’s acquisition (the “Formula 1 Acquisition”) of Delta Topco Limited, the parent company of Formula 1, on January 23, 2017, and subject to a six month investment review process.

Chase Carey, Chairman and CEO of Formula 1, said, “We have been actively engaged with all teams to shape a shared vision for the sport that will create real value for all stakeholders. While the window for this particular investment opportunity has passed, we are pleased with the collaborative discussions we are having with the teams.”

“These discussions will take time, but we appreciate their receptivity towards further aligning our incentives for the long-term benefit of the sport.”

The approximately 19 million shares previously reserved for issuance to teams have been retired. Liberty retains the right to offer future investment opportunities to Formula 1 teams.

Earlier this year, Ferrari boss Sergio Marchionne said of the offer, “The Concorde Agreement expires in 2020, so becoming a non-voting shareholder in an entity, which would effectively keep us trapped in without knowledge of what 2021 and the later world will look like, is something I consider unwise.”

“One of the things that I tabled with Chase is clarity on what the post-2020 world looks like, and what Ferrari may be able to get from its involvement in Formula One activities. Once we have clarity, then I think it becomes a lot easier to decide whether we want to participate in this venture,” added Marchionne.

Big Question: Are teams making a wrong call not to buy Formula 1 shares?