Investors to 'bombard' CVC over F1 bribery scandal

By on Tuesday, August 30, 2011

Investors in F1 rights owner CVC are set to ask tough questions at a forthcoming meeting, the Financial Times is reporting.

One "large European investor", concerned about the Gerhard Gribkowsky bribery affair involving Bernie Ecclestone, confirmed he will be asking some of those questions at the meeting in September.

Another said he expected investors to "bombard" the CVC board with their concerns.

"Every large investor has this on the radar screen and will want to get answers to two questions: did you know anything about what was going on and, if not, what changes have you made at the company level after you have found out?" he said.

The Financial Times said investors are particularly concerned about the handling of the affair by CVC's F1 manager Donald Mackenzie.

"One of the larger, institutionalised private equity groups would have long dealt with it by changing F1's management and communicating openly," the source added.

The bribery affair has triggered wider questions about the legitimacy of CVC's purchase five years ago of the commercial rights from the BayernLB bank.

The German bank's chief financial officer Stephan Winkelmeier insists the sale has been audited.

"So far those checks have not revealed any problems and have shown that the sale was carried out properly, in accordance with the bank's regulations and with a price that was in line with expectations," he said.

But former owners Constantin Medien - formerly EM.TV - have filed a lawsuit claiming the rights were undervalued amid the sale to CVC.

F1 chief executive Ecclestone however, suggesting Constantin Medien is hoping for an out of court settlement, insisted to The Independent that CVC paid "a very good price".

"They didn't buy the shares under value, it was the opposite ... four or five proper people offered considerably less ... there could have been a big bust-up with the teams," he said.

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