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Liberty Global acquires controlling stake in Formula E

Liberty Global acquires controlling stake in Formula E

Liberty Global acquires controlling stake in Formula E

Liberty Global is taking a 65% stake in the Formula E electric car racing world championship after buying out Warner Bros Discovery, the series announced on Thursday.

The acquisition will, on completion, leave Liberty Global in control of an FIA-sanctioned championship nearing the end of its 10th season. The telecoms company previously held around 35% of the shares. No financial details were given.

While Liberty Global will control Formula E, Liberty Media is commercial rights holder for the much bigger and older Formula 1 business. Both companies are chaired by U.S. billionaire John Malone.

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Liberty Media also announced in April a takeover of the MotoGP motorcycle world championship, subject to anti-trust clearance.

Liberty Global CEO Mike Fries said the two companies were different entities and he would be surprised if common ownership by one individual created an issue.

“This is a pivotal moment in Formula E,” he told Reuters on a video call. “Formula E needs capital and it needs conviction. We are absolutely intending to provide both of those things at this critical moment.

“If you look at the trajectory of the series it’s been incredible, the performance of the cars, the quality of the teams we have, the breadth of the calendar, the increase in fans,” he added.

“All of these things are from our point of view tailwinds, but you can’t ride those tailwinds if you don’t have capital and conviction.”

Fries said Liberty Global intended to keep funding the series until reaching break even, a point he saw as being not far off.

Formula E on Wednesday announced a 17-race calendar across 11 locations with double-headers in Shanghai, Tokyo, Berlin, London, Monaco and Saudi Arabia. The series also claims a viewership of almost 400 million globally.

Series CEO Jeff Dodds said the remaining 35% was owned by a large number of small shareholders, including Saudi Arabia’s Public Investment Fund (PIF) with around 5% and founder Alejandro Agag.

Dodds said Formula E was growing rapidly and could eventually challenge Formula One’s supremacy as the biggest championship, a stance he said was more confidence in the technology rather than just fighting talk.

“The Gen 3 evo car that will hit the track from the end of this year gets to 100kph about 30% faster than the current Formula One car,” he said.

“Two years after that car is released we’ll go to Gen 4…that car will go for longer and be materially faster…Our car performance in the very near future will be equivalent to that of a Formula One car.”

At the same time, Formula E’s cost cap of 13 million euros per team compares to Formula 1’s $140-Million. (Reporting by Alan Baldwin)