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Liberty Formula One Group A FWONA

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Morningstar’s Analysis

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Liberty Media Announces SPAC at Investor Day, Expect Live Nation to Be Aggressive on M&A

Neil Macker, CFA Senior Equity Analyst

Analyst Note

| Neil Macker, CFA |

Liberty Media held an investor day on Nov. 19 for its portfolio companies, including Sirius XM, Live Nation, and Formula One. Given the crowded nature of the day, much of the information had been disclosed before but there were some interesting new details particularly on the merger and acquisition front. Liberty Media announced the creation of Liberty Media Acquisition Corp., a special purpose acquisition company, or SPAC, that will look to raise $500 million to purchase media and entertainment assets that don’t necessarily fit under one of the three tracking stocks for SiriusXM, Formula One, and Atlanta Braves. However, given the complicated structure of Liberty Media, we would not be surprised if the tracking stocks for Sirius XM and Formula One end up holding some of the 20% of the shares in the SPAC that Liberty plans to hold after the capital raise. We are maintaining our narrow moat ratings and fair value estimates of $5.90, $33, and $50 for Sirius XM, Formula One, and Live Nation, respectively.

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Company Profile

Business Description

Formula One Group controls the exclusive commercial and promotional rights to the FIA Formula One World Championship series, and the monetization of those rights is the primary business of the group. The firm is responsible for development and promotion of the Formula One race series in concert with its three partners: the FIA (the regulatory body), the teams that participate in the series, and the series' commercial partners, which include the race promoters, broadcasters, sponsors, and advertisers. Formula One Group is a subsidiary of Liberty Media Corporation, which purchased the firm in January 2017. Formula One stock is a tracking stock for the assets under Formula One Group with Liberty Media.

Contact
12300 Liberty Boulevard
Englewood, CO, 80112
T +1 720 875-5400
Sector Communication Services
Industry Broadcasting
Most Recent Earnings Sep 30, 2020
Fiscal Year End Dec 31, 2019
Stock Type Speculative Growth
Employees