Sources: Penske Paid $300-350M For IndyCar, IMS Assets
Roger Penske agreed to purchase Hulman & Co.’s racing assets for $300-350M, according to sources close to the deal, in a pact that will give him control of IndyCar and IMS. Sources say the deal’s value reflects how IMS has been the money-maker of the Hulman & Co. portfolio, helping to underwrite the series that has traditionally not turned a profit. Penske will also likely invest tens of millions of dollars in facility upgrades over the coming years. Allen & Co. was Hulman & Co.'s financial advisor, while its counsel was Ice Miller. The deal is expected to close in January (Adam Stern, THE DAILY).
DEAL DETAILS: The AP's Jenna Fryer notes IndyCar CEO Mark Miles has confirmed that there was "at least one interested party before Penske was sought out" as the eventual buyer. Sources said that Allen & Co. was tasked with "finding either a buyer or strategic partner and connected" the George family with Liberty Media, which also owns F1. Liberty was "fairly unknown" to Hulman & Co CEO Tony George and he was "uncomfortable, even as his three sisters encouraged the sale." A source said that Liberty "balked at an initial asking price" of $250M and "walked away from any potential deal when told there was another buyer in the game." There was a "third group of investors who expressed interest, and just last week, a fourth individual tried to enter the bidding." Penske kept the deal under wraps and "deliberately had a news advisory sent" at 8:00am ET this Monday in an "effort to catch everyone by surprise." To avoid appearances of a conflict of interest, Penske said that he will "step down from the pit stand next season." Penske plans to keep the current executive teams of "both the speedway and IndyCar." He will "put his own board in place," and George will "likely have a role in some fashion." Penske "wants NASCAR" at IMS and he likes the two Cup races "running less than two months apart on patriotic weekends" (AP, 11/5).
MAN WITH THE PLAN: In Indianapolis, Nathan Brown writes there is a "reason any unrest" over Penske's purchase has "reached only a low murmur." His "love for the history and progress of the series and its most famous racetrack" is why George "sought him out for stewardship in the first place" (INDIANAPOLIS STAR, 11/6).