Formula 1 owner wants MotoGP in €4 Billion deal

The future of elite motorsport looks set to be united under one roof, if a multi-billion deal is accepted.

On Wednesday, March 27, reports emerged that Formula 1 owners, Liberty Media, are entering exclusive negotiations to acquire Dorna Sports, the entity holding the rights to MotoGP, for a sum in excess of €4 billion.

This strategic move, reported aims to consolidate the top-tier auto and motorcycle racing series. The transaction is set to be finalised after overcoming competition from TKO, a group led by influential Hollywood agent Ari Emanuel.

Regulatory hurdles ahead

The potential merger is similar to a previous situation where CVC Capital Partners had to divest its MotoGP interests due to European Union regulatory concerns.

This historical context adds a layer of complexity to Liberty Media’s current ambitions, as it seeks to navigate similar regulatory landscapes.

The deal’s completion would mark a significant milestone, merging the realms of Formula 1 and MotoGP under a single corporate umbrella.

Strategic growth and expansion

Liberty Media’s track record of elevating Formula 1’s global profile is noteworthy. Their innovative approach to marketing, including a strong emphasis on social media presence and collaborative projects like the Netflix series ‘Drive to Survive’, has significantly boosted the sport’s popularity.

Acquiring MotoGP presents an opportunity for Liberty Media to replicate this success, capitalising on a similar business model that includes broadcasting rights, event hosting fees, and merchandise sales.

Financial implications and stakeholders

In 2023, Formula 1 reported a 64 per cent increase in operating profit, while revenue rose to $3.2 billion from $2.5 billion, affirming the financial viability of Liberty Media’s stewardship.

Conversely, in 2023, Dorna Sports reported revenues of €483 million in the same period. Major stakeholders in Dorna, including Bridgepoint and the Canada Pension Plan Investment Board, hold significant shares, with Bridgepoint having been an investor for 18 years.

This acquisition not only has the potential to reshape the commercial landscape of motorsport but also underscores Liberty Media’s ambition to dominate the global racing industry.