Notebook from the hotel lobby

IMG_0051The joys of Italy have often, during my career, been related to the Internet, or rather the lack of it. I shudder to remember all the adventures I have had when trying to file copy. Here at the hotel in Monza, the last few days have been a minor nightmare, unless I sit in the lobby and type there. It’s a way of meeting people, I suppose, and I did have a nice long chat with Eddie Jordan the other evening, something that is hard to do in the F1 Paddock where EJ is a bundle of distraction and ploughing a straight course of conversation with him is almost impossible.

Conversations in the F1 Paddock are often disjointed because of interruptions and it is often quite frustrating. I spent about 15 minutes at one point on Saturday evening trying to get just a few words with Toto Wolff, but a stream of people came along and interrupted, or Toto felt the need to grab others as they were passing by. I understand why this happens and I am a very patient man, but there are ways to do these things. Some people know how to do it, and others do not. It is, I always feel, a good way to judge the way people are. The reason I mention this is that it was thanks to just such a rude interruption that I got the confirmation I had been searching for all weekend about the sale of the Formula One group by CVC Capital.

And it came straight from the horse’s mouth.

I will come out and admit, straight away, that I never liked the cut of Donald Mackenzie’s jib. I’m not someone who is impressed by money, power or appearance. I judge people on their intelligence, their honesty, their good manners and other such old-fashioned things. A grouse moor, some guns, green wellies and a Land Rover do not make you an aristocrat. Just as a press pass does not make you a pork-pie hat wearing monster.

I am sure that Mackenzie oozes charm at dinner parties with his own kind, but I have always found him arrogant, rude, and disdainful, as only the newly-rich can be. His “well, you couldn’t possibly understand” attitude was a very clear sign that he was high on his own supply and, in the words of Shania Twain, “that don’t impress me much”. Good for him for being talented at making money, but I’m not ever going to praise what he did to Formula 1 and I am happy to apply my boot to the rear of his twill trousers to assist him towards the door marked “uscita”.

I was chatting with Ron Dennis on the grid when Mackenzie sailed up and butted straight into the conversation and Ron, knowing which side his bread is buttered on, immediately responded with a big grin. I no longer existed. I was the invisible man. Lots of people are prone to do this and one has the choice of making a remark about politeness, which always creates an awkward situation, or one can withdraw gracefully once it is established that they are not going to even say “excuse me”. Mackenzie, alas, clearly missed the class about having class, but he was so convinced of my invisibility that he said “this is my last race” to Dennis. It is rude to listen to the conversations of others, but if they butt in and blurt things out when you are still part of the conversation, it is not your fault. So as far as I am concerned that is fair game. So Donald confirmed that the sale is completed.

Perfect. My notebook reads “Donald ducks out”.

So goodbye Mr Mackenzie, it’s back to asset-stripping rubbish bin manufacturing firms for you. Your days in the F1 sunlight are over. And, here in the land of sport, we are rejoicing. The day of the jackal is over. I see all financiers as unprincipled and greedy, and he sees all journalists as being bad people. East is East, and West is West, and never the twain shall meet.

One is tempted to look at the sale of the sport as being a day of liberation. We have seen the last of an occupying army and the Yanks are coming, with Shermans, chewing gum and chocolate, and nylons for the ladies. We can dance the night away. We have no idea whether the liberators will be a good thing, but right now, we really don’t care. We can worry about that tomorrow. Today is the time to weed out the collaborators, shave their heads and throw them in the rivers, or be more colourful and defenestrate them, as they used to do with ghastly Regents in Prague. It is a time when we can all pretend that we resisted and award ourselves medals. It’s a time when the scalawags will call for reforms and the carpetbaggers will arrive, looking for opportunities (Wow, was that Flav at Monza, or someone who looks like he’s had a face job to look like Flav?) It is a time when charlatans, snake oil salesmen and cowboys all pop up. The Malone Gang is coming to town and we will all peep out from behind the curtains to see what they look like. Chase Carey has a good name to be a gunfighter and maybe he has a lot of notches on his six-shooters. We’ll see…

The cynics will say that all revolutions go full circle and you end up with another version of what you originally had, but others see change as a chance for enlightenment and new attitudes. What F1 needs now is reconstruction. A Marshall Plan for the sport to get it moving, make it cool again and attract the young of today.

The notebook from Monza features lots of stories of drivers: Perez-Renault? Sainz-Enstone? Pastor Maldonado? and other such scribbles. It is all still up in the air, but the market is now on the move and so we will see some action soon. I think the scrawls that are most likely to happen are “Ocon to Renault” and “Stroll to Williams”. The latter may read like a reminder, but it is actually a news story. The note $25 million next to it is all the explanation required.

There are other notes that say “Manor sale” and “Aus-China” which tell their own stories, but there is also the more cryptic “Apple-EU”, which was designed to remind me that the EU Competition Directorate is now back from the summer holidays and in a feisty mood, having walloped Apple Inc with a massive tax bill. These things take time, but one day soon the notebook is going to have a scribble that says “F1-EU” and one wonders if the Malone Gang know of this booby-trap.

156 thoughts on “Notebook from the hotel lobby

    1. I agree, Joe has a great way of putting things.

      Joe,
      I suspect the Malone gang will do something right off the bat to get the small teams onside with respect to costs. If they are smart they will then negotiate a deal with the EU for the long term and then point out to Ferrari and RBR that is the way it is for the future for agreements for the to be in the series. They have the ability to say what was in the past was on a different watch to the EU if they get in first.

      They also need to get on right away how to sell F1 in all forms of new media. The big problem they have is Bernie. How to sideline him permanently. Not sure how they do that? He seems to have strong Klingon tendencies.

  1. In order to fix the sport the teams need to break away and form a new series. That’s the only way to get out from underneath the capital structure that Bernie and CVC imposed on the sport.
    Liberty Media might be a better owner than CVC, but it would be even better if the owner were all of the teams, collectively, a la NFL or MLB.

    1. I sense the problem with F1 compared to NFL or MLB is that the rules of the sport are dynamic and there will never be harmony between the teams. They would just cannibalise themselves.

    2. The CART vs IRL was 20 years ago was disastrous for both sides. Instead of American driver driving American cars on oval tracks, they ended up with what they did before. A majority of foreigners driving a foreign chassis with half the engines foreign on mostly road and street courses, which was not what Tony George wanted and spent some $150 million of the family’s money on. Only IndyCar ended up with a lot fewer fans in an era where virtually all sports are booming in bringing in money.

  2. It could now be time for the FIA to stand up and remind everyone that they own the sport and that what is being sold for a truly ridiculous amount is just the reminder of a lease of the commercial rights and not the series ownership.

    It may also be time for the FIA to take back control of what had been devolved to Bernie by neglect, things like the tyre contracts, fuel contracts (yes I know but it should be) and the rest of the little things that it was easier to let Bernie take care of and to re-establish the proper authority of the FIA.

    Of course the above would mean having a president who cares about F1, rather more than trying to make a name for himself, by clinging to the trouser legs of various high profile organisations. He could have made his name as FIA president but has failed to do in a positive way. The great puzzle is why he did not appoint a vice president to run F1; but his actions in some other matters indicate that he has a fear of anyone not subordinate to him and reacts violently to any apparent challenge to his absolute authority. Maybe now is the time for him to step down as president so that we can have a complete new structure for F1. He is after all, undoubtedly one of the collaborateurs!

    1. @rpaco
      thank you for raising important questions that might have been raised in the article above. Regretfully Joe decided to focus so many lines on issues of petty personal grievance, like being interrupted while conversing with others, and so forth, things we usually file under the general heading “life”.

      I wish for any evidence that the new owners will take the long term interests of F1 to heart, to any greater extent than the folk Joe didn’t take to.

      At least F1 did exist under the old dispensation. As for the future, here’s hoping we can all have interruption-free conversations under the new regime!

      1. Jeez, you really know how to make me feel motivated about my audience. I think I’ll leave it to rpaco to explain F1 for free. You are as graceless as Mackenzie.

        1. I love that you include things like that as it gives a feel of what it is like to operate in the F1 environment. It shows how you have to work to source the information you dispense to us. Great that the above mentioned “gentleman” revealed information through his own rudeness.

        2. Go for it Joe – I like your style straight from the hip, tell it like it is.
          First thing I did was to google “defenestration” – so I got the English lesson and the history lesson in one. Thanks. I was rather hoping it was a form of castration using shards of glass – rather than surgical instruments.

            1. …but practiced widely throughout Europe for more than 100 years. A very
              effective ( though rather messy to clean up !) demonstration of disdain
              and chagrain with individuals who, shortly prior to their rapid arc of
              departure from this life, believed themselves invulnerable and unassailable.

              Mmmmmm ……F1 could do some very fine clearing up with this system.

        3. This piece illustrates well the reason why, after a few years, I continue to visit your blog. You don’t just provide information but also real insight; the additional stuff regarding personal behaviour gives insight about how the movers & shakers work and the manner in which they operate. Although, it may seem trivial to some, to me it isn’t. It helps tell the story and to make it far more interesting and readable. If I just want banal information then I can get that from the glossy magazines and elsewhere. Keep doing what you’re doing Joe. Regarding the behaviour you describe (interrupting etc), to you and me (old school I guess) it seems downright rude. Regrettably, with my cynical hat on, it seems to be how much of the world works now. That doesn’t make it right though and, like you, it still grates when I hear it.

          1. Completely agree. Ignore the haters Joe, I think most readers just quietly enjoy your writing. I’m sure your website traffic tells the real story!

      2. I think part of the reason JS told the story was to explain that he was not quoting an off the record remark. I also reckon you would side with JS if you had actually met the CVC boss. Remember ” manners maketh man “.

      3. Sorry you may call it petty personal grievances but to me and I suspect many others who read and follow Joe it is a PERSONAL insight into a world we will never get close to.

        I find Joe has a way of “humanising” the issues, the way the characters are portrayed and the development of important themes is why many of us keep reading.

      4. It never ceases to amaze me that readers like pleb have that kind of takeaway from a notebook article. It’s supposed to raw and I loved the fact that a civil conversation can flow from it from the likes of rpaco against the backdrop of literally being placed at the scene thanks to the imagery of the notebook commentary. Hilarious and insightful I felt like I was behind the scenes.

      5. Pleb, dear boy, you have forgotten that this is Joe’s blog. His online space, to use as he sees fit. He is inviting us into his lounge. It’s infra dig to then criticise the decor.

    2. If Jean Todt wishes to use his role as FIA President as an advocate for road safety, that is his choice. However he has a responsibility to motor sport as well. If Todt isn’t looking after F1 on a daily basis then he has to appoint a deputy to do the job. The circumstances now — new owners with different ideas — require that an individual acting with the authority of the FIA President gets involved.

      It’s not just F1 that needs an authority figure at the FIA. Regulation of prototype and GT type sports car racing has been handed over to regional authorities and series organisers. Single seater racing looks healthy on the surface but the junior categories are going stale. They’re too expensive and too dependent on spec cars. No team seems able to jump the gap from junior single seaters or sports cars to an F1 team.

      1. Yes but there was already an FIA organisation covering road safety. JT has hijacked it to crate a higher profile
        for himself. In fact he created a parallel organisation duplicating the original official role.
        It will be interesting to see what happens as he is expected to negotiate with the new owners, will this make his/the FIA’s shares null and void.
        This is not the new structure that F1 needs, the commercial rights should be held by an FIA trust.
        The part flotation will place a value on all the shares, but no doubt several share classes will be created. (some more equal than others)

    3. rpaco, why do you feel it necessary for the FIA to take control of fuel contracts when that is something that has always been independently organised by the teams?

      1. Well the FIA will lose its income from their CVC F1 shares and it will need replacing. TO me the obvious answer is to take back the tyre deal from Bernie and to have a commission from both the tyre supplier and the teams for tyres and to add a similar deal with the fuel which is currently a free choice. This would also help equalise the performance between teams if they all use the same fuel. Of course that may create sponsor difficulties but it was just an idea for an income stream for the FIA.

        1. I don’t think they have a share with revenue. They get money in fees and the share is only paper value until sale

  3. 宁為太平犬,莫做亂离人 – or “Better to be a dog in peaceful times than a human in chaos.” More commonly as mistranslated by Joseph Chamberlain as “the old Chinese curse: May you live in interesting times.” Surely Malone could not be worse than CVC – gulp!

  4. I also hate the “invisibility factor” when it comes to conversations. Happens constantly in my job when suddenly a superior shows up and interrupts as if you were not there. Certaingly annoying.

    Regarding the upcoming change, well, lets hope it brings better times but money is money and people who manage that stuff is mostly the of the same pattern, greedy and arogant.

    1. There is no excuse for bad manners. It just makes people look rude and arrogant if they can’t come up with a simple please, thank you or excuse me. It’s not hard and a little goes a long way.

      Works amazingly well in reverse too. If you ever meet someone rich and/or famous and they look you in the eye and talk to you like you’re the only person in the room. Oddly enough it’s the prats and the wannabes that usually have the worst manners.

    2. I wonder if Ron deliberately forgot to be polite and introduce you so MacKenzie wouldn’t clam up on anything juicy in front of the press? 🙂

  5. Very nice insight into the f1 paddock.
    Nice to see journalists have the same feelings about the current situation of f1 , that the fans do.
    Hope this is a new beggining , and f1 goes back to it’s roots.
    Tv open, competition, personalities, thrill etc.
    The article shows in an entertaining way, that there is light at the end of the tunnel.

  6. Liberty Media/Liberty Global owns Virgin Media in the UK which is the main competitor to Sky TV, so I have to wonder whether Sky UK’s exclusive long term F1 broadcasting deal earlier this year was done to tie things up before Liberty got involved..

    1. Or how much Liberty will be prepared to pay to rip the contract up and renegotiate with the BBC/C4 to get it back on FTA TV to get the viewing figures back up? Bear in mind Virgin is only available in certain areas of the UK.

    2. Virgin Media only resells sports programmes. They don’t produce any of their own. if they took up the UK F1 franchise, they’d probably resell it to Sky, BT or the BBC. Having had first hand experience of Virgin, I’d not touch them with a bargepole.

      1. Amazon, Netflix, Microsoft, PlayStation network etc. changed their business model to produce original content. As has BT. With the network Liberty has what’s to stop them doing the same off they choose to keep it off FTA?

  7. Joe – you probably didn’t see but Bernie made a complimentary reference to Indianapolis Motor Speedway on the grid whilst talking to Martin Brundle. Do you think the old dog will buy into Indycar!?

    1. My interpretation of that:

      1. F1 at COTA is in trouble. Bernie needs an alternative and/or a way to put pressure to relsolve the problem;

      2. Same thing for Montreal, so long as the new garages aren’t being built;

      3. Indianapolis is apparently off as an option for the FIA WEC;

      4. 2005 was more than a decade ago.

      My conclusion: Perhaps Tony George is thinking the whole schmozzle caused in 2005 can be forgiven… which would be fine with Bernie/FOM

    2. Unless I missed some very subtle cues, my interpretation of Bernie’s comment was in reply to Brundle mentioning the new Monza deal to Bernie and asking if they’re going to resurface the track, then saying that actually he likes the bumpy old surface as it adds history/character to the place, and Bernie replied with a comment that they could keep some of the history, like the yard of bricks at Indy (i.e. retain a small patch of the old surface at the start/finish). I didn’t read any more into it than that. If Bernie was trying to send a coded message he would probably have raised the subject directly rather than as an off-the-cuff response to Martin IMHO.

  8. “I am sure that Mackenzie oozes charm at dinner parties with his own kind, but I have always found him arrogant, rude, and disdainful, as only the newly-rich can be.”

    Methinks you need to come off the fence and say what you really think Joe. In all seriousness, appreciate the forthright reporting – very refreshing.

    Would suggest not all newly-rich folks are as bad as the man you had to endure the company of however. One need only take a look further down in the article at Apple. Steve Jobs upbringing was of a very humble working class family, yet he remained grounded after making his fortune. If only all those who have accumulated vast sums realised financial wealth does not usurp a sense of decorum, the world would be a better place for it.

    1. I suspect the source of the money has some bearing. It makes a big difference to the psyche whether it was earned by providing something useful to society or extracted by sucking something out.

    2. Jobs supposedly leased a new Mercedes SL every few months to take advantage of a loophole that didn’t require him to get license plates for it that way. That’s not necessarily reflective of his interpersonal relations, but there are tons of stories about those as well.

      1. dgoure, I assume Jobs did this for aesthetic reasons (I don’t blame him, US license plates are REALLY ugly). Although I never met him, I’m not sure he was as “grounded” as some think.

    3. You’re joking, right Mr. Ballard?

      By any number of credible accounts, Mr. Jobs was a cruel, ruthless and rude person. At one point in his life, he even denied paternity to his first daughter Lisa when it was not really in dispute.

      Not all rich people are rude and not all poor people are polite. But I’m glad Joe shared his feelings about Mr. McKenzie as it placed the latter’s comment in the correct context.

    4. Bob Ballard, as others have noted, whilst there were some who were prepared to write flattering pieces about him, there was also a side to him that was quite vindictive.

      In some ways, Jobs’s behaviour verged on actively criminal – for example, we know from his personal correspondence that he set up and actively managed an anti-competitive hiring agreement with other tech companies, such as Google, with the intention of suppressing the wages for coders and other related staff.

      At one point, he effectively blackmailed the CEO of Palm back in 2007 by implying that, if he did not join the anti-competitive hiring scheme that he was running, he would use Apple’s superior financial musclepower and suite of patents to sue Palm into bankruptcy.

      Similarly, he wasn’t as generous as he made out to be – when he rejoined Apple, the very first thing that he did was to cancel all of Apple’s charitable donation programmes. Jobs knew how to play well to the media (especially by giving substantial discounts on his products to journalists), but was capable of being quite a nasty piece of work in private.

      1. I hold my hands up, my bad. Jobs was a bad example given his emotional indiscretions that after I subsequently researched a little further and have concluded do cast his character in doubt. My original point was to allude to individuals who have amassed fortunes yet have not let that alter who they were – there are examples out there, particularly in silicon valley but also in the UK.

  9. So if the Duck is out, the most pressing question for me is what is Bernie going to do next? Retire or just business as usual?
    Joe, do you have any thoughts on this you could share?

  10. I don’t think I’d have the grace and patience to do your job Joe. I’d probably lose it if someone kept on doing that to me.

  11. F1 may have seen the end of the bloodsuckers, but it would seem the spider isn’t prepared to stop pulling the strings. I’m afraid that unless the new owners have a management and culture clean out at FOM, nothing will change.

    I’m surprised how few of the other F1 sites are covering such an important story. For example, not a word from the F1 money guru! Are they afraid of something.

  12. What a great piece of writing, pointing out that with liberation can come the seeds of its own destruction. Stay vigilant, but good riddance to the ancien régime.

  13. “On “F1-EU” Magrethe Vestager is very bright with a sharp knife. So if she decides. F1 need to belooked into. Then she will finde the skeletons/ Unlawfulnes

    Bjørn

    1. An EU investigation will not happen because of the outcome of the Brexit vote. And, even if that impediment can be overcome by focusing on those teams headquartered outside Britain, the EU is too pre-occupied with issues that impact its very purpose (and, by extension, its existence); namely 3rd world migrants and the re-birth of the right wing.

  14. F1 is close to exhaustion.

    Change is deeply needed.
    Change is coming !
    Whether this is the right change, we’ll see.

    CVC has very severely hurt the business and F1. They have displayed what private equity companies can do at their worse.

    I am wondering how one can pay 8.5 billion USD (entreprise value for 100pct, x20 years of profits, before deducting debt!) for F1 when we are a few years away from autonomous cars and with younger generations in historic motorsport countries less and less interested in cars and even less in racing cars.

    The only way to justifiy this price in the future is probably to further deepen the problems of F1 (pay-per-view access amongst others) and squeeze the F1 teams, spectators and race organisers even more.

    Let’s hope now that Old-Bernie (an incredible businessman) and his useless gestapo-style clique leave quickly the F1 paddock, and let a new generation of builders with a vision do the right things.

    NEXT PLEASE !

    1. > The only way to justifiy this price in the future is probably to further deepen the problems of F1 (pay-per-view access amongst others) and squeeze the F1 teams, spectators and race organisers even more.

      Absolutely.

      CVC will only sell for the value they can get from doubling down on the current path (& believing that that is sustainable).

      So the only way to make the numbers add up is either to do the same – or to see some whole new opportunity that lets you meet CVC’s price without carrying on the same way. And maybe Malone or someone has a plan along those lines, but just the fact that F1 changes hands isn’t necessarily going to make it happen. Here’s hoping.

  15. Joe… love your blog, love Grand Prix+, love your notebook and I particularly love your style of writing (above is another classic) …. Thank you…… 🙂

    I just hope CVC Capital disappear completely from the sport having taken in 10 years (as mentioned on TV this weekend) something like 7x there initial investment out of the sport.

    As for Liberty Media, I am just hoping for the best at the moment. I am sure they will be an improvement but only time will tell how bigger step they will take in the right direction.

    1. I think Joe said in the past the some of the other investors had agreements to do the same as CVC. So control of the CVC shares may well give de facto control of thre business.

      1. Well sure control is one thing, but sale of 35% does not amount to sale of F1, unless there is some agreement that other shares are sold with CVC’s tranche.

    2. It’s the work of sneaky people.

      They’ve spread a mental disease which causes even basic arithmetic to be treated like a nuanced and debatable thing. So, for example, they evidently need a 35% stake in F1 to have more than 50% control, while the US Senate now requires 60% to have what we used to call a simple majority.

      Whenever I see something other than 51% being what carries the day, I become very suspicious of those involved… because they’re up to something.

      I think it’s fine for cutting edge mathematics to be poking about with things of iffy definition, but nobody who’s honorable will go mucking around with basic arithmetic.

    3. Wadell & Reed, Black Rock, Texas Teachers, et al own shares with minority rights, specifically tag-along rights to sell on the same terms as the majority shareholder CVC. When you add all these shares it is far more than 50%, and that is all you need to control the business.

  16. It probably all comes back to Ecclestone and his side kick. Mackenzie, pretty typical of his ilk, but then what do you expect from a pig but a grunt, and who involved him in the first instance ? The Scottish bankers screwed the British economy alongside that F1 is small beer.
    It will now only be financial wheeling and dealing, the FIA sold the silver for a mess of potage, failed completely to put in the appropriate safeguards and then handed more and more control to Ecclestone who sadly doesn’t appear to be going anywhere just now.
    We can all hope that everything will improve but I for one think that may be just a pipedream. I very much hope I may be proved wrong.

    1. It was a big mess of potage and they got a second payment for around $80 million but I doubt JT will donate that to a charitable foundation any time soon…

  17. Brilliant. These post race notebooks are always special. As for Liberty Media, lets hope it is not, “Meet the new boss, same as the old boss.”

  18. Your remark about Chase Casey reminds me that I have read somewhere that the George W Bush era politicians based their policy ideas on the TV series Gunsmoke (a ‘fifties Western). I hope he has more sense, but given that he is so close to Fox News and Rupert Murdoch, I very much doubt it. Heaven forfend that they should hire Flav in some official capacity! Malone’s media interests might also necessitate quite a few renegotiations for the various national TV contracts.

    Relating to your remarks about Internet speeds: does “L” or “LOW” after a filename for an issue of Grand Prix+ mean that it’s a low resolution version?

    Finally, about the Hack’s misfortunes: http://hedgren.com/. It’s still very much in business, although I don’t know whether his exact bag is still available.

  19. It was passed on to me that Liberty Media have only been owners of media (which have long since been sold). They haven’t been producers of media.

    To quote the great 20th Century philosopher Peter Townshend;

    “Meet the new boss. Same as the old boss.”

    Joe I’m curious as to why you feel you’re out from the yoke. Optimism that three could be change in the air or just happy to be rid of Cynical Vulture Creatures?

  20. Liberty Media……CVC…….is there much difference? I’d assume that Liberty has Banks and Financial Institutions who loan $ to them for such baubles as F1?
    On that basis, unless Liberty is a philanthropic based business, then isn’t this sale just, same **** , different day? Don’t mean to sound downbeat, but it is one mega load of bucks replaced by another mega load of bucks……

  21. I’m confused by the BBC report that he deal is not yet done and there are still two other contenders.
    Also if you look at JA’s blog it seems that CVC are to retain a holding but the other main shareholders in the rights lease are selling up ie BlackRock and W&R which I think is strange. Why would funds and pension companies sell off their stakes in an investments that has such a high return? They will be virtually impossible to replace other than with high risk corporate bonds, (or maybe South American bonds) nothing much else has an ROI anywhere near that of F1. Do they think that F1’s astonishing profit level is about to drop? Or that F1 is to get the Apple tax treatment? Will a new majority shareholder change the country of registration for tax? How does that work anyway?

      1. Their shares have tag-along rights and a drag-along provision. Tag-along is a right of the minority because as a minority shareholder you don’t want to be at risk of the majority shareholder (CVC) cutting a deal to sell on favorable terms and leaving you as a minority out of the sale. Drag-along is a right of the majority (CVC) to force minority shareholders to sell in a case where the majority has engineered a sale that requires minority participation.

    1. There’s a long way go before a resolution in the Apple/EU dispute and I wouldn’t put money on the EU winning. Eddie Jordan knows a thing or two about tax domiciles apparently.

      1. Yes but things have changed, now many of those tax havens are cooperating with various tax authorities. Ireland or Eire are accused of giving aid to a company, which is forbidden in the EU. It is not just a matter of tax but of an effective subsidy giving Apple an advantage against competitors.
        Are you a lawyer by any chance? To me it seems that , lawyers get stinking rich whatever happens, whoever wins. (A bit like arms dealers)

        1. Actually it seems it is all down to a mistake by the Irish government in not cosing a particular tax loophole, which was put there for a specific purpose but has been exploited by clever accountants. (Sounds a bit like F1 engineers) There is now likely to be a swift closure of Section 110 or at least a restriction back down to it’s original purpose.

        2. That would be telling. However, Ireland has stated through an appeal that no state aid was given at all, so we’ll see. How much cooperation by ‘tax havens’ is effectively given is very much open to debate. Maybe your last point has some validity!

  22. I knew this would be a fun notebook… So many questions, all to be answered in time I guess.

    I’m curious to know if you’ve seen an increase in subscriptions from the US? Anyone from Liberty contacted you yet?

    Also why did Eddie decided to announce yesterday was Bernie’s last race? Was he talking on behalf of Bernie, or was he talking someone else’s agenda?

    And, sorry, last one, did Ron smile at you once he knew you’d heard what the duck had to say? Can’t imagine Ron smiling much.

  23. Per usual Joe spot on reporting as only you can.

    CVC and the head troll Mackenzie were and still are a bunch of carrion gorging jackals, “good riddance and don’t let the door hit you on your ass on the way out”, mind you, if this sale goes thru and I’d say that is a BIG if, CVC would see a profit of $7.5 billion on their investment!

    Liberty Media/ Malone owns as other of your avid readers have cited, owns Virgin Media, Formula E and other stakes in various companies that are HUGE conflicts of interest. Plus, The FIA has a 1% stake in Delta Tepco and would see $100 million profit from the sale and they’re supposed to be impartial remember! conflict. The Eurpean commissioner is back and not in a good mood about any of this having just bitch slapped Apple to the tune of $3.6 billion. Malone has the dough and the know how, but there is a very tangled web that needs to be sorted, he most likely will have to divest from formula E – which btw showed a negative return on his investment and it was leaked that he wants to run formula E races before F1 races which is a huge violation of that series charter. EU competive commission will not sanction that and then there is how is Malone going to see a profit on this purchase were it to be ok’d by the EC.

    Bernie for all of our griping had done an amazing job maximizing sponsorship and fees from venues, the only way Malone can see a profit is to add more races, go exclusively subscription based for his cable TV network and to create a real promotions department which Bernie has never had as he hasn’t had to. Unlike the NFL or MBL here in the US where all the teams have a collective marketing agreement, F1 teams own and market themselves and the drivers own their image rights so I don’t think we’re going see bobbleheads of Lewis or the Hulk anytime soon…….. To be continued and no doubt our man in Havana- Joe will be the first to give us the real dope n this deal.

  24. Excellent article Joe, thanks. Bob Ballard, I’m sure Joe is speaking of the french term, “nouveau riche” , I’m sure the ghastly McKenzie fits perfectly.

    1. GP, I was also disappointed to read about Ron behaving in such a way. Joe, is this typical of him? In interviews he comes across as quite the opposite of what you described.

    2. What has Ron done wrong? I’m not a fan of Ron — perhaps a fan of Bruce and the amazing Anglo/Kiwi/Aussie/Yank mix at McLaren. Gordon Coppuck designed great racing cars for that bunch.

      Over the years, Ron has flipped between idiocy and genius. He didn’t always look after his drivers. This year, Ron is looking after Jenson Button and Fernando Alonso, so Ron has two grown ups on the team. Both drivers know how to win races.

      I reckon Jenson’s year out is a form of retirement. Until Jenson gets bored and buys a rally cross car 😉

    1. Joe, you should have pretended that they didn’t know each other and said : “Ronald, meet Donald. Donald, meet Ronald”.

  25. As an observer of John Malone for some time I find this choice of his odd. Malone, famously of cable company provider Telecommunications Inc, or TCI has gone through several transformations in his business life. A long time ago he sold TCI to AT&T for something like $27 or $43 billion dollars, the guy who operated the company for Malone was none other then Leo Hindery of NJGP fame. Later Malone entered into a long stretch of owning parts of companies but not operating them, kind of like Warren Buffet. If there is one thing that Malone is known for its his love for insanely complex financial deals. Malone always came out well with each deal and it encouraged him to do more. A few years ago Malone tired of the financial games and decided he needed to get back into owning as an operator. I guess F1 is that interesting mix of complex financials and operating. I don’t understand why he would want F1 at the price we are reading its being sold for.
    As a person Malone is known for honesty and a personal touch. When he was dong the TCI thing he lived in Colorado with his wife and the story goes that every afternoon he would leave the office and go back home and have lunch with his wife. That’s who this guy is.
    The guy who is rumored to become the new Mr. E, is known for his enormous mustache and many contacts in the entertainment business. He looks like he just walked out of a Victorian novel. He’s a big guy with a big personality, to me just another guy with a seat on a few boards.
    Total mystery for the future if this buy-out takes place. If Malone wanted in he could have started buying in years ago, it wasn’t like CVC had no interest in selling bits of F1 here and there. Why is Malone making his move this way, all (controlling interest) or nothing?
    Over the years The New York Times has had many stories about Malone, starting from when he first arrived on the scene.

      1. Ah! Thanks. I was being dense….

        (and I forgot to say – the blog is excellent as always. Where else are we going to get actual *fact* about what’s going on?)

  26. Interesting times Joe….

    I was kind of hoping you might have more to share from your conversation with Mr Whiting. Even Teddles was a bit off-the-cuff there. Most unusual…..

  27. I read just recently that McKenzie due to retire as CVC head so he could have been referencing just that….

  28. What ever happened to Kaltenborn EU complaint / suit? On what timescale are we talking about progress here? Months? 1 – 3 years?

  29. Joe, thanks for speaking for Us about the Mackenzie-ites Gang.
    Every word well placed; thanks for doing so on our behalf.

  30. I’m proud of you, Joe, my attitude toward those sort of people is exactly the same! I’m a bit dissapointed in Ron, though, I would have thought that with his NZ connections he might have had the decency to at least say “Excuse me, Joe” to you!
    Keep up the GOOD work.
    Thanks,
    PK.

  31. Somehow you made me think of Ron Dennis before you actually mentioned his name…
    Something about a range rover and boots…

  32. $25 million is a good swag but surely Stroll is not ready to replace Massa for Williams. Stroll is good, but not looking like the next Verstappen. With the quicker cars next year an early debut for Stroll up against Bottas could be a career shortening move. Why not a test and reserve roll for Stroll coupled with a GP2 season, and get Toto Wolf to lend Williams Wehrlein for a couple of seasons to see how he goes against the much touted Bottas along with a discounted Merc engine to sweeten the deal. Might be worth more than $25 million to Williams? A better short term less pressurised entry for Stroll would be Manor.

    1. Lance $troll has been doing very well in European F3 with his “absolutely standard, in no way modified or redesigned to within a gnats wotsit of the limit of the F3 regs and exactly the same as his team mate’s” Prema Dallara F312

      🙂

      1. Stroll’s been on a roll in Euro F3 this year but his record overall is pretty good. Nick C and Maxi have been getting results too so his car seems fairly standard to me. I certainly don’t think he’s going to be a liability, far from it, and if his pop is going to throw in $25m for his seat I think Williams would be stupid not to.

        Sainz won’t bring anything more than talent and if STR get current Ferrari engines next year, or are they going back to Renault?, then he’ll be comfortably in the top 10 still. No need for him to move.

        1. It may seem standard to you, but it isn’t. Please trust me on this one.

          I think my worry with Stroll is his 2015 accident record in F3. Reminds me too much of Maldonado in WSR.
          .

    2. I find the concept of Stroll at Team Willy rather depressing. Sainz would be a much better idea if they want a tooled up racer, which is what Team Willy has always been about.

  33. Wow Joe, tell us how you really feel regarding Mackenzie? Don’t think I can recall you tearing into anyone on such a personal level before??
    Maybe Flavio???

    You have been most outspoken in regard to CVC’s predatory business approach to F1, but restrained in your personal comments.

    My point? Disappointment I suppose. Will you similarly give Bernie kicks to his backside as he is exiting the business?

    1. I don’t mind horrid people who are good for the sport but horrid people who are bad for the sport deserve boot-to-butt interface situations.

    1. Sorry to be pedantic, but what do you mean by “plus va changer”? I think, perhaps, you are trying for “Plus ça change, plus c’est la même chose”, a remark of Alphonse Karr which probably sounded quite profound after the second bottle of absinthe was running dry.

  34. I have said before, not so sure this will go through. No real strong rumours or even gossip about who is putting up the funds – paper for Liberty to acquire CVC share. I think there might also be a kicker in from the Norwegian Fund, who wanted out on the possible float, way back, and they may also want to unload. That is if CVC sell out, then the Norwegian want the same exit route and the same price. They I think can force the issue, and Liberty will have to cough up more money – paper…..

    Right now Liberty would be holding one heck of a lot of paper, and yes while the rates are super cheap, but one only has to look back to Leo Kirch – Kirch Group who acquire F1 from Bernie only to go bust in 2002 and here is where we find ourselves after CVC took over that holding.

    Interesting in that Bernie said if CVC sell then he will also, and right now he has skin in the game at a little over 5%, so is Bernie selling or holding? I think he is holding.

    As Joe has pointed out, the EU went after Apple and the F1 payments is also very much on the table, so why would Liberty go for it now, and risk not been able to unload it through a float or even a partial float in NYE. I can see signs of the Kirch Group coming back all over again. The EU went after the Fiat Group and have them over a barrel about tax not paid…….

    The EU is getting its teeth sharpen and F1 better be prepared to mend their ways, which ask the question, then how is Liberty going to pay for it, if a float is side lined due to the EU investigation. Of course they will have to bleed F1 dry to pay for the Paper.

    Back to square one we find ourselves.

  35. “(Wow, was that Flav at Monza, or someone who looks like he’s had a face job to look like Flav?”

    The idea of someone who isn’t Flav actually wanting to look like the T-shirt salesman leaves me in need of a giant economy size bottle of Mind Bleach.

  36. My favourite read post race is Joe’s notebook. The stories behind the stories, the wheat being sorted from the chaff. The challenges with WiFi, long-haul flights and visas. The epic drives through Europe. Keep them coming Joe, i love them!

  37. Well I’m relieved to see CVC’s reign end, but I will always be wary of new owners until they show themselves to have at least some interest in seeing the sport flourish. Really I’d just like to see the way the money is dished out between the teams done more fairly, and I’d like to see the circuits get cut some slack (which I suspect will be hoping too much of the new owners.) The amount they have to pay to host is ridiculous, and it galls me that there hasn’t been a french grand prix for years.

    I’ve been a fan of this sport since I was four in 1991, I love it dearly. Yet I’ve never been to see a grand prix because no way is it worth the ticket prices – Silverstone is not far down the road from where I live, but I’d rather spend that kinda cash on a holiday.

    1. I’ve been a fan since I was 9, in 1985 – but what did it for me was actually going to the track. The noise! The excitement! The oil in my mouth as a car’s engine let go right near me! Until that time, it had just been cars on a bit of grey track, then cut to other cars on another bit of grey track… It took a visit to Brands for it all to “click” and I’m glad I did.

      I wonder what your definition of a holiday would be? For me, it would be getting out of the house for a few days and doing something different. Glastonbury Festival was, for many years, my holiday. Similarly, camping at a Grand Prix for 3 days would count as a holiday for me too! I guess it’s all relative.

  38. This is probably the best notebook article by Joe! Just lovely.
    I may be wrong but I think that Malone will keep BCE on board till he gets the teams onboard the new Concorde agreement and then replace him.(Agag is a name being thrown around)
    Ron Dennis can go from being a genius to ordinary in no time. Still cant believe that he managed to keep hold of Button. Gives him so much leverage over Alonso and also helps to keep Stoffel at McLaren.
    Donald MacKenzie will finally become invisible in F1 circles. I tend to feel that a transition from a finance guy to a media baron will help improve F1 coverage if anything.
    Joe, does Liberty’s takeover mean the end of Sky’s F1 coverage. I hope that F1 gets back to free to air TV (which is really difficult I admit) or atleast cheaper pay tv options?

  39. Joe. Did you see /hear DC insulting a reporters language ,in an attempt to bully his way to interviewing Bottas on grid?

    1. Yes i saw that…. Valtteri told DC two or 3 times he wasn’t going to speak to him ahead of the lady interviewer which prompted a rather silly comment from the white jeaned impressario along the lines of Bottas thinks he’s big time all of a sudden qualifying 5th (or similar.)

  40. Hi Joe

    In Denmark we are still waiting to see, if we have Mag to follow next year.

    It seems there are a lot of different opinions on his abilities and what he has shown so far, but I assume it’s fair to say, that he hasn’t shown star quality – but on the other hand he has not performed so badly that he has driven himself out of the “top-22” next year.

    As I read your “Ocon-Renault” was the most written note on your paper in the weekend, which driver team scenario do you currently see happening?

    Ocon-Palmer?
    Ocon-Mag?
    Saintz-Ocon?

    Thx for some nice write ups. Always nice to hear from someone with a thorough knowledge – although Peter Nygaard also has his weekly columns in Denmark.

    Regards,
    Kenneth

  41. OK, I suppose I am one of the cynics that you mentioned, Joe. One group of rapacious businessmen is being replaced by … another group of rapacious businessmen. Hmm. And, yet, we expect favorable change?

    Maybe the best thing we can realistically hope for is simply that: change. The former owners seem to have been greedy in the extreme, and unconcerned about slowly killing their golden goose. Perhaps, Liberty will be smarter than that.

    One can always hope.

  42. You mentioned that Liberty has a chunk of FE. It appears that FE is moving to Channel 5 in the UK, though whether that is actually live on tv or only on streaming is unknown. All practice sessions to be shown on Spike.

    Could we see the same for F1 I wonder.

  43. Off topic: Gordon Murray has now produced a flat pack truck aimed at distant climes in Africa. Whilst of course this is completely new I cannot help thinking of the days of CKD (completely knocked down, not the kidney complaint I have) where a car was shipped to a colony in its component pieces. This however is much more of a convenient shipping solution to inaccessible places, then to be assembled by local talent.

  44. Oh, those doorsteppers must be so frustrating! I’m glad you have maintained your dignity and have not chosen “if you can’t beat them, join them”.

    Thank you for the most informative blog post I’ve read anywhere in years! Plenty to contemplate… I’d have loved to be a fly on the wall for your discussion with EJ.

    For what it’s worth, I always look out for you on Ted’s notebook. I enjoy the conversation when he chats with you, and hope he’ll do so more often!

  45. It hurts, but you need to understand Mackenzie is the boss and has the right to be disrespectful towards you if he wants.

    1. Has the right to be disrespectful?

      Well, I suppose… in the sense that anybody can be a jerk.

      But if there’s a point here, I can’t find it…

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