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SBD Global/August 5, 2013/Finance

Setback For Ecclestone After FOG, CVC Ordered To Release F1 Sale Documents

F1 CEO Bernie Ecclestone’s "legal problems deepened after Formula One Group and owners CVC were ordered by a London court to release hundreds of documents relating to the sale of the motor racing series seven years ago, amid claims it was undervalued," according to Roger Blitz of the FINANCIAL TIMES. Ecclestone and other defendants "face a claim from German media group Constantin Medien for damages of at least $171M." Ecclestone's legal team "must now prepare for the Constantin Medien court case," which has been set for Oct. 28 and is scheduled to last six weeks. Ecclestone "is expected to be called as a witness," along with F1 CFO Duncan Llowarch. Among the documents the judge ordered CVC to disclose "are due diligence reports on F1 at the time of the sale and the refinancing; appendages to the disclosure letter from Mr. Ecclestone to CVC at the time of the transaction relating to F1 revenue streams; CVC’s loan application to RBS relating to its purchase; investment committee minutes; financial models it relied upon for its offer; and a Deloitte tax report prepared for CVC at the time of refinancing." The judge said that FOG "had to disclose in-house financial models projecting revenues and costs, a memorandum of understanding signed by F1 teams that committed them to F1 until 2012, documents relating to the purchase of sponsorship and hospitality businesses; and documents relating to the addition of a race in Abu Dhabi to the F1 calendar" (FT, 8/4).
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