It is worth noting that the reports that have been peddled (at length) in recent days about the Qatar Investment Authority being the potential leesee of Silverstone have been denied out in Qatar, where they have some idea of these matters. An official spokesman at QIA told the Qatar News Agency that there were “no relevant negotiations, currently nor in the past, in this respect”. The report, which was initially published by the Independent newspaper, said QIA was conducting due diligence on the circuit.
What is also clear is that Silverstone Circuits has entered into an exclusive and confidential agreement involving a third party. As this is confidential it is difficult to know exactly what that means but it is relatively safe to assume that this is some kind of “preferred bidder” status. This means that the lessor (Silverstone Circuits Ltd) has selected one of the bidders and intends to lease the circuit to that group/person, subject to the completion of negotiations and legal arrangements. Once that has been completed it is safe to say that some kind of announcement will be made.
In the current economic climate are there not really that many people who can afford the kind of money that is needed for a deal like this. It is not a good time to be borrowing from the banks, unless one has a bullet-proof business – and motor racing has never been an easy sell to bank managers. The other point is that this cannot be a phased deal to any great extent as Silverstone needs the cash to develop the circuit as quickly as possible, in order to start to generate the revenues that it hopes will come from the various new projects that will employ thousands in the new facilities. I have been told that the winning bid is from a wealthy family with connections to the BRDC and that the bid came to make sure that Silverstone remains the centre of British motorsport. How many families are there that fit the bill? Hmmm… No wonder some have suggested that the most likely buyer is an Ecclestone Family trust company.
There have been lots of reports saying that Bernie Ecclestone says he is not involved, but then one always needs to know the question that was asked when one considers the answer given. If someone asked Bernie: “Have you bought Silverstone?” he would telling the truth if he were to say no, if the reality was that an Ecclestone Family trust had leased Silverstone.
A trust is an institution which independently manages the assets of a company or a high net worth individual. They are created so that taxation is minimised. There are professional trustees, although trustees can be friends or relatives. The trustee can spend money for the beneficiary’s health, education, and living expenses until a specified moment at which the money remaining becomes the property to the beneficiary/beneficiaries.
There may be other families with links to the BRDC who have the kind of money that is needed, but I have yet to find anyone who can think of one.
joeblogsf1 
It’s a real shame that F1 doesn’t have the marketing power of NASCAR or the NFL in the US. The costs involved for organizers are so out of reach for the average fan to comprehend. I had a little taste of reality when in Indianapolis a few years ago when I had the opportunity to chat with Tony George. F1, is not cheap, it really is a king’s sport. At then end of the day, it’s a business and the goal for everyone is make money.
I also believe it to be very important for the Sports side of F1 to retain such great circuits such as Silverstone which is becoming more and more of a challenge based on the amount of money required to maintain, update and manage older circuits. Bernie is one of the few that can pull this off. I hope he does, at least it’s someone who has a real interest in making it work.
I think you’re absolutely right. The remaining work at Silverstone needs to be done as soon as possible and Bernie has the vision to see that when it is complete it will be a very good venue indeed. Frankly, it was not that great for this year’s GP and when the World Series by Renault, which attracts an F1 size crowd, went there a couple of weeks ago they operated entirely out of the old garages, paddock and buildings.
I hate the idea of Bernie now getting his greedy little hands on Silverstone after almost forcing it off the calendar and ruining Donnington in the process.
No doubt the first thing to go if he was involved would be the fans campsite as he has no interest in people who can’t afford 5 star luxury attending/watching his races.
The timing is interesting. Maybe it was a wedding present…
Well, Bernie can’t live forever (unless our assumptions about the power of the Old Malicious Foe undergo some drastic revision). So even if an Ecclestone family trust is taking a 100 year lease or whatever it is, he’s not going to be around to do anything with it for very long. Presumably Bernie is one of the trustees of his various family trusts, but do we know anything about who the others are?
Bernie has woven himself and his businesses so closely into the structure of the sport that there’ll be an almighty struggle when he finally moves on to his eternal reward — whether that’s outsiders trying to seize a piece of the pie, or internal battles.
Interesting to see Tony Fernandes buying QPR from Bernie though — I wonder (now that Tony has set up Riad Asmat as head of the motor-racing business and presumed Team Caterham Air Asia (ugh) team-principal-in-waiting) whether Tony will take on an increased role (management or ownership) in the sport itself.
Joe, any thoughts in that regard?
Two things are nagging at the back of my mind:
One is what happened to the ownership of Donington? Is it still owned by the Wheatcroft family?
The other was that I am sure I read something about Bernie’s ex wife owning a track, or maybe that was one of the French ones.
I’m confused about this “securing Silverstone’s place on F1” thing.
Bernie practically waged war on the place, and got it to budge, ohh maybe an eighth of an inch off the epicenter of racing, for a moment.
Constant talk of endangered assets only ever comes from buyers.
Very strange business where you rely on your customers (fans) to call a spade a spade. If you were selling your business, and someone started banging on how without x you became somehow irrelevant, would you a) go ape crazy or b) call a lawyer? I hazard both.
Try it another way: “Without this ad deal, Joe cannot stay at the center of F1 journalism”.
If i said that for real i’d expect a bloodied nose as well as a defamation case to answer in court!
I’d also expect my other business to be hurt.
It’s this “Silverstone may not count” crap which makes me feel bad about the deal. Obviously i am far from alone in being suspicious.
Two general problems exist economically:
1. Too much cash chasing a home, at any non zero non negative rate.
2. Holders of actual cash (no longer any bank i heard of) only want big transactions.
There’s a vignette in Felix Dennis’s book on getting rich (which is very funny, brutally honest, but stuffed to the gills with sensible advice) how he simply could not raise a 20 million working capital loan. No bank was interested in such a small deal. “We can lend you 100 Million, Mr Dennis” was the drift. Turning down such self serving flattery in fact did make Dennis rich.*
How much does Silverstone really need? I don’t mean for the wonderful plans they’ve drawn, i can hear my dad growling “cut yer cloth according, boy”. I wonder if he’d have been so pleased at me being into F1, if he saw the overt money culture of recent years. Pretty sure he’d have pushed me off it. (and he was no stranger to big number lending)
The question should be instead “how much do fans and racing members need?” A sane business ought to be thinking what happens when deleveraging really hits the individual economy. That sort of thing can go on for decades. If you sell something with commodity inputs, in theory in recession your supply cost also steps downwards. But leases and money for property has no further place to go lower. This starts to risk a white elephant. If fixed costs are kept thrifty, real racing outfits can adjust also, we’ll still get races. But huge fixed costs owed to people so insulated they likely barely care about 400 million or so is a noose. I mean wakey wakey, if there is to be a harsh recession, the first need of human life is something to cheer us up and crucially, to bring us together. I’d be planning to treat catering for that as a central objective. Set things well for the next 50 years, not get in hock like this for buildings which may not last. (Building tech these days is amazing, but the designers are working to very close tolerances, and 30 years seems still to be the design lifespan target)
zenmeister is right the major things need moving on, fast, but i have not been able to find any good isomorphics or elevation plans or much of any detail. What’s on Silverstone’s website is too low resolution, and it suggests to me – also from a skim read – that architectural planning is speculative for much of it., Which means unknown budgets. So does 400 million even do it? Has anyone seen anything in e.g. Architectural Review? (stupidly dropped my sub to that) because that’s where proud architects go to explain their designs.
There’s tons of handy brain capacity amongst F1 fans, just wish we could corral some of it to better look into these things realistically and in an organized fashion.
*I should have framed it, but my Columbian mate in ad sales had a ahm, rather persuasive negotiating style. One morning this fax landed “we are sorry, but we do not enter into transactions for only GBP 5950” signed by chairman of a not small defense contractor. This made my day for a very long while. Oooh, penny drops, maybe i am not asking enough in my own calls? 🙂 I would never have left that company if the middle management had had a brain cell between them. You applied for the job and stayed for the nutters. And the disproportionately high number of F1 fans. Bugger the PC crowd and 1997 employment laws which put a stop to the possibility, those things swept away a productive culture.
Denials must be in the air at the moment. Qatar’s denial that they are speaking to Silverstone sounds just like Ecclestone’s denial that F1 would be broadcast on pay per per view TV in the UK. That was like a like what a month before a deal was signed to broadcast F1 on pay per view TV in the UK…