Formula One owner Liberty Media agrees to acquire rights to MotoGP in deal that values owner at $4.5 billion

By Ciara Linnane

Liberty Media is buying Madrid-based Dorna Sports, owner of rights to the leading motorcycle-racing championship

Liberty Media Corp. said Monday it has reached an agreement to acquire Dorna Sports S.L., which owns the rights to the MotoGP World Championship, from Bridgepoint and Canada Pension Plan Investment Board in a deal with an enterprise value of 4.2 billion euros ($4.5 billion).

Liberty Media (LSXMA) owns Formula One, the international racing championship for open-wheel single-seater formula racing cars.

MotoGP is the leading motorcycle racing circuit with top speeds above 200 mph. The championship was launched in 1949 when it held six rounds across Europe. For the 2024 season, the company will host 17 races across 17 countries.

"MotoGP is a global league with a loyal, enthusiastic fan base, captivating racing and a highly cash flow generative financial profile," Liberty Media Chief Executive Greg Maffei said in a statement.

Under the terms of the deal, Liberty Media will acquire 86% of MotoGP while the latter's management will retain the remaining 14%. The deal has an equity value of EUR3.5 billion and the existing debt balance at MotoGP is expected to remain in place after the deal closes.

The equity consideration to sellers will be comprised of about 65% cash, 21% shares of Series C Liberty Formula One common stock and 14% retained MotoGP management equity.

The cash portion will be funded with a mix of cash and debt, subject to market conditions. The deal is expected to be completed by the end of the year.

Carmelo Ezpeleta, CEO of Dorna since 1994, will continue to run the business which will continue to be headquartered in Madrid.

Goldman Sachs acted as financial adviser to Liberty Media and is providing debt financing for the deal.

Liberty Media is parent to a range of media, communications and entertainment businesses including SiriusXM and Live Nation Entertainment that are attributed to three tracking stock groups, namely the Liberty SiriusXM Group (LSXMA), the Formula One Group and the Liberty Live Group (LLYVA).

Maffei was chief financial officer at Oracle (ORCL) and then Microsoft (MSFT) in the 1990s and 2000s. He is also chairman and CEO of Liberty Tripadvisor Holdings Inc. (LTRPA), which owns a controlling stake in Tripadvisor Inc.

Liberty Media's stock was up 0.4% in Monday trade and has gained 44.6% over the last 12 months, while the S&P 500 SPX has gained 28%.

-Ciara Linnane

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04-01-24 1009ET

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