CVC reduces stake in F1 prior to IPO

Anneken Tappe
22 May 2012

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CVC Capital Partners has sold a $1.6bn stake in Formula 1 Group to BlackRock, Waddell & Reed and Norges Bank Investment Management prior to the company's IPO, according to reports.

The partial exit would reduce CVC's stake in the firm from 63.4% to around 40%. The partial exit is believed to value Formula 1 at $9.1bn, including debt.

Formula 1 is expected to float on the Singapore Exchange within the quarter, raising up to $3bn for the company.

Goldman Sachs, Morgan Stanley and UBS are lead arrangers for the IPO. CVC is a cornerstone investor and will be forbidden from reducing its stake within the first six months of the float.

CVC acquired Formula 1 in May 2006 in a deal estimated to be worth $1.7bn. RBS arranged the debt for the transaction.

In early 2011, former BayernLB chief risk officer Gerhard Gribkowsky was held by the Munich police over allegations of corruption in the 2006 buyout. CVC denied any wrongdoing but was reportedly urged by its investors to address the allegations.

In March 2012, CVC refinanced their investment, replacing the $2.92bn debt facility maturing in 2013/2014 with $2.27bn maturing in 2017/2018. RBS and Goldman Sachs arranged the debt.