Liberty buy-out of F1 gets government scrutiny

Britain’s Competition and Markets Authority is considering initiating an investigation into the take-over by Liberty Media of Formula 1.

Last September, the US media consortium agreed to acquire the sport from current majority shareholder CVC Capital Partners for approximately $4.4bn.

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The UK’s CMA will be checking whether the deal violates British anti-competition laws, and stated that that any written representations about any competition or public interest must be made by 21 November.

“The CMA is considering whether it is or may be the case that this transaction has resulted in the creation of a relevant merger situation under the merger provisions of the Enterprise Act 2002 and, if, so, whether the creation of that situation has resulted, or may be expected to result, in a substantial lessening of competition within any market or markets in the United Kingdom for goods or services,” it said in a statement.

The CMA added that the deadline by which a decision on whether a more formal investigation shall be required is January 5 2017.

Liberty Media made clear at the outset that’s it’s deal to acquire F1 would have to clear certain regulatory hurdles.

“The completion of the acquisition is subject to certain conditions, including the receipt of certain clearances and approvals by antitrust and competition law authorities in various countries, certain third-party consents and approvals, including that of the FIA”.

The European Commission’s own anti-competition body is also expected to chime in on Liberty’s affairs, with European Parliament member Anneliese Dodds already lining up a complaint about a potential conflict of interest involving the FIA.

Indeed, Formula 1’s governing body holds a 1 percent stake in the business, estimated to be worth $40M, meaning that it will profit from the deal – which it must also approve – going ahead.

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