Latest F1 news in brief – Wednesday (Update)

UPDATE Updates shown in red below.

02/19/14

  • Vettel might dominate again if they can ever get the Red Bull running

    2014 cars 'perfect' for Vettel – Webber

  • Red Bull rivals 'back in the game' – Montezemolo
  • Nasr, Banco do Brasil set to join resurgent Williams
  • Mood 'completely different' at Williams in 2014 – Bottas
  • Camera not to blame for Schumacher injury – report
  • Lotus have become the final F1 team to formally unveil their 2014 chassis New
  • How CVC has secured the future of Formula One New
  • More delays for Red Bull in Bahrain New

2014 cars 'perfect' for Vettel – Webber
(GMM) If Red Bull emerges from its early-season technical crisis, reigning world champion Sebastian Vettel will be a force to be reckoned with yet again.

That is the view of Vettel's departed teammate Mark Webber, despite many believing the radically new 2014 regulations will finally end the German driver and Red Bull's run of dominance.

Some think the 2014 rules have ended the utter dominance of aerodynamics, putting the 'power unit' and its technology in the spotlight.

And early 2014 testing seemed to indicate the Red Bull era could indeed be over, as the RB10 and the troubled Renault V6 package struggled simply to turn laps.

Australian Webber, however, thinks that if the RB10's issues can be solved, the 2014 rules could actually work in Vettel's favor.

Webber recently said Vettel's strength is in slow corners, and it is precisely there that the high-torque cars of 2014 have proved difficult to handle.

"It's probably not what people want to hear at home," said Webber, "but I think that helps Sebastian. That's right up his alley, that's perfect for him."

After 12 years in F1, 37-year-old Webber has retired from the category and this year will spearhead Porsche's return to the top-tier Le Mans prototype class.

But he will be in Melbourne in three weeks when the 2014 season begins.

"I was in the boxing ring (the F1 grid) just a couple of months ago so hopefully I can use that experience in commentating to talk about the strengths and weaknesses of drivers and so forth," said Webber, who will work with Australian television.

"I am really looking forward to the season ahead with Porsche, and with a later start to that championship in April, it gives me an opportunity to return to Melbourne and have some fun from the other side of the fence," he added.

Red Bull rivals 'back in the game' – Montezemolo
(GMM) After four years of title-winning dominance, Red Bull's rivals hope to be "back in the game" as the new F1 era kicks off in 2014.

Even before Sebastian Vettel's run began in 2010, Ferrari had already lost two consecutive world championships to McLaren and Mercedes' former guise Brawn GP respectively.

Team president Luca di Montezemolo said the time for Ferrari dominance has come again.

"We dominated for five years, they (Red Bull) did it for four and I think now we must make sure we get back to winning," he is quoted by Italy's Tuttosport.

"I have utmost respect and praise for what they have done, knowing that today we all get back in the game. We'll see," he added.

Team boss Stefano Domenicali said the F14-T got off to a solid start at Jerez, but warned that Ferrari must now build on that momentum.

"It is impossible to start with a perfect car in a season where so many changes are made," he is quoted by Italy's La Gazzetta dello Sport.

"We still have much work ahead."

In the Red Bull era, it is widely believed that F1's most famous aerodynamicist Adrian Newey utterly mastered the rules.

But the emphasis has switched to the new turbo and ERS-powered V6s for 2014, and Red Bull and engine supplier Renault struggled even to run the new RB10 at the first Jerez test.

Putting in lap after lap in southern Spain, on the other hand, was Mercedes.

"Reliability is the keyword for the first five, six races," team chairman Niki Lauda is quoted by Osterreich newspaper.

"Who is the best prepared will be furthest ahead," he predicted.

The F1 circus has now moved to the island Kingdom of Bahrain for the second of the three pre-Melbourne tests.

"Jerez was an engine test," said Lauda. "Now the real preparation begins."

But he said the pecking order still will not be clear after the first week in Bahrain.

"After the second week (in Bahrain) you can read a little bit more into it," said Lauda. "Until then it is not only difficult, but also pointless."

So Lauda insists it would be a mistake to write off Red Bull on the basis of Jerez.

"You do tests to find problems," he said.

Nonetheless, he said Mercedes has started on the right foot and is on target for its ultimate goal.

"We want to be world champion as soon as possible," Lauda is quoted by Kleine Zeitung newspaper.

"Whether it is this year or not, you cannot say yet. My personal goal is that it happens in the next two years.

"This is a hard goal, but that's how it should be," the former triple world champion and F1 legend added.

Nasr, Banco do Brasil set to join resurgent Williams
(GMM) Felipe Nasr and his sponsor Banco do Brasil look set to become the next pieces of the puzzle for Williams' promising campaign in 2014.

Having finished a woeful ninth of the eleven teams last year, the once-great British team seemed to have got the new season off to a solid start with its newly Mercedes-powered FW36 recently at Jerez.

The car is set to be title-sponsored by the iconic Italian drinks brand Martini, raced by the long-time Ferrari driver Felipe Massa, and this week it emerged that Brazilian oil sponsor Petrobras has returned to the team.

Now, the next piece in the puzzle is believed to be GP2 frontrunner Felipe Nasr, whose surname oddly rhymes with that of his Brazilian countryman Massa.

We reported recently that the 21-year-old is believed to have signed an agreement to be Williams' reserve driver in 2014, including Friday practice running at about half of the 19 grands prix.

And Germany's Speed Week now reports that Nasr will bring about EUR 10 million to Williams in the form of his sponsor Banco do Brasil, a major Brazilian bank.

When the Petrobras deal was unveiled in Rio this week, deputy team boss Claire Williams would not confirm the Nasr deal.

"I can't comment on that," she is quoted by Globo, "but for Brazil I'm sure it would be awesome.

"Formula one is a big market for Brazil; the people love sports and formula one in particular.

"So I guess to have another Brazilian in F1 along with Massa would be good for the sport and good for Brazil," Williams added.

Mood 'completely different' at Williams in 2014 – Bottas
(GMM) The mood at Williams is "completely different" compared to the same time last year.

That is the view of Finnish driver Valtteri Bottas, as he prepares for his second campaign in formula one with the once-great British team.

Having slipped to ninth of the eleven teams in last year's constructors' standings, former multiple title winner Williams has invested heavily for 2014 and now features highly-respected names like Pat Symonds, Felipe Massa, incoming sponsor Martini and Mercedes power.

Insiders believe the new FW36 appeared reliable and competitive at the recent Jerez test, and according to Bottas the Grove based team is in high spirits heading into the second test this week in Bahrain.

"It's a good feeling to see that your team is in such good spirits," he told the Finnish newspaper Turun Sanomat.

"The feeling now compared to this time a year ago is a completely different category.

"Now the spirit is really high, especially when all the major departments have new staff on duty.

"They've come from a variety of top teams like Red Bull, Lotus and Mercedes, so our experience has increased.

"Things have gotten better since Pat Symonds came in — he put things on a better basis and hopefully it will show with the performance of our car as soon as possible," said Bottas.

Bottas also sounded delighted with Williams' new engine partner, with the team having switched from the now-troubled supplier Renault over the winter.

"From what I could see at the Jerez test, I'm happy that we chose Mercedes," he said.

There are fears, however, that the new and highly complex 'power unit' technology, and the severe fuel limitations, will detract this year from the actual driving.

"The fastest driver will not win this year," Toro Rosso engineer Xevi Pujolar told Spain's El Confidencial. "Now it (the winner) will be the one who is fastest in the most efficient way."

Bottas agrees that technology will play a much bigger role in 2014, but: "Driving skills will still be the most important thing."

Camera not to blame for Schumacher injury – report
(GMM) Speculation the personal Gopro video camera mounted on Michael Schumacher's helmet contributed to his injuries is "not true".

That is the claim of the major German newspaper Die Welt, following reports the spotlight had fallen on the camera's mounting and the fact the helmet was found at the crash site in several pieces.

The reports claimed the camera had a hammer-like effect when Schumacher's head struck the rock.

A source at the French technology research laboratory Critt said: "At the wrong angle, (the camera) could lead to a shock effect, cracking the helmet."

And helmet maker Uvex said a camera "may affect the protective effect" of a helmet in the event of a particular impact.

But a report in Die Welt newspaper said the investigation – which found no one at fault – by French authorities into the Schumacher crash had disproved the camera theory.

That is because "Schumacher crashed into the rock with the right side of his head. The camera was mounted in the centre of the helmet and remained intact".

"In this way, the video material was not damaged in any way, and the memory card could be fully evaluated," Welt added.

Lotus have become the final F1 team to formally unveil their 2014 chassis
Lotus have become the 11th and final team to launch their 2014 chassis, with the E22 debuting on Day One of the Bahrain test.

The car's appearance – 'tusk' nose and all – has been well-known for some time now after the Enstone team released images of it at the end of January. Since then, it has completed 100km of running for filming purposes at Jerez but Lotus's struggle to finish the car in time for the first pre-season test, also at Jerez, leaves them with ground to make up on their rivals ahead of the start of the season in Melbourne on March 16.

Between now and then, Lotus have eight days to test both the reliability and performance of the E22 – although, given the travails suffered by the Renault-powered teams who did make it to southern Spain three weeks ago, it could be argued that the gap is not as big as it might have been.

With Pastor Maldonado putting the first mileage on the car the weekend before last, it was new team-mate Romain Grosjean who took to the 5.412km Sakhir track in earnest on Wednesday morning.

He is also driving the car on Thursday, with Maldonado back in the cockpit for the remaining two days.

So far, it's been a winter of upheaval for Lotus, whose well-documented financial problems – a factor in the departure of Kimi Raikkonen last season – saw them take on Maldonado rather than the more highly-regarded Nico Hulkenberg.

Talks with Quantum Motorsports, the investment group which has tried repeatedly to buy a 35 per cent stake in the team, appear to have stalled, while Lotus received another setback last month when Team Principal Eric Boullier departed for McLaren.

How CVC has secured the future of Formula One
CVC, the private equity firm which is the biggest shareholder in Formula One, is often criticized for taking money out of the sport. However, in fact it has protected it from hostile takeovers in the most unlikely of ways according to an article in the Telegraph by Christian Sylt.

Since CVC bought F1 in a £1.2bn ($2bn) takeover in 2006 it has made more than £2bn ($3.3bn) from the sport as Pitpass has reported in detail. In 2012 CVC made £1.3bn ($2.1bn) alone from selling shares in F1 leaving it with a 35% stake. Its windfalls have put it in the cross-hairs of many critics including some of the smaller F1 teams which sometimes struggle to stay afloat and ideally want more prize money. It is easy to sympathize with them but actually their financial outlook has accelerated since CVC arrived on the scene.

In 2012 the teams' prize money came to £450.7m ($751.8m) which is over four times more than the £103.9m ($173.4m) they took home in 2005. Likewise, their global footprint has grown as new races in wealthy nations such as Singapore, Russia and Abu Dhabi have been added to the calendar under CVC's watch.

True, this is largely down to F1's chief executive Bernie Ecclestone but CVC threw its support behind him from the moment that it became a shareholder so it too has played a significant part. Crucially, the teams don't just get increased exposure from the new races but more money too. Their prize money comes from a 63% share of F1's underlying profits which is more than double the cut that they previously received. It means that the more high-paying races which are added to the calendar, the more the teams benefit.

CVC has even come under fire for the way that it bought F1. As Pitpass revealed way back in 2007, it didn't use its own money and instead the purchase was fuelled by two loans – £660m ($1.1bn) from the Royal Bank of Scotland (RBS) and £578.8m ($965.6m) from a CVC fund which itself has external investors.

Since CVC invested in F1 it has refinanced the bank debt several times which means that the money was paid back with a new loan on different terms. The new loans were of a higher value than the initial one from RBS and the debt held by F1's parent company Delta Topco came to around £1.5bn ($2.5bn) in 2013.

In July last year Pitpass revealed that the latest refinancing, which was handled by RBS and Goldman Sachs, reduced the interest rate on the debt from 6% to 4%. It trimmed Delta Topco's debt-related charges which came to £70.9m ($118.3m) in 2011. They have been a lightning-rod for critics who claim that this is money which is leaving F1 as a result of CVC's involvement.

However, Delta Topco's debt seems to have a silver lining. This is found in the terms of the loan which are known as covenants. They remained confidential until 2012 when CVC planned to float F1 on the Singapore stock exchange and had to outline the key covenants in the prospectus.

As Pitpass can reveal here (right) page 36 of the prospectus states that F1 will default on its loans if any shareholder, other than CVC, gains more than 35% control. In specific, it says that "under the Senior Facilities Agreement, a change of control occurs where a person or a group of persons acting in concert gains the right to exercise more than 35% of the voting rights exercisable in a general meeting of the Company. A change of control is an event of default under the Senior Facilities Agreement, entitling the lenders to, amongst other things, cancel the Senior Debt Facilities."

As the Telegraph article reveals, the threshold has been increased from 35% to 50.1% since then and it has far-reaching implications. First let's consider what would happen if Delta Topco defaults which is the consequence of any shareholder getting its hands on more than 50.1% of F1.

The debt is secured on the shares and assets of almost all the key F1 companies which means that RBS and Goldman Sachs would have legal right to them in the event of a default. In summary, the two banks could ultimately get control of F1 if any shareholder other than CVC gains more than 50.1% of the sport. It would not be the first time that F1 has been owned by its lenders. CVC bought 75% of the sport from a trio of banks after they took over the stake when its previous owner, the German media company Kirch, failed to pay back a loan they had given it.

F1's lenders could agree to waive their change of control provision but there is no guarantee they would do this. Likewise, as the prospectus states, the debt could be refinanced with a loan which does not come with the change of control covenant but, again, there is no guarantee that lenders would agree to this.

The bottom line is that this could prove to be an important safety net as it means that if CVC or any of F1's other shareholders, wanted to sell up and give control of the sport to someone else, they would need to get consent from RBS and Goldman Sachs. If they didn't, the two banks would be entitled to take over F1 themselves. It is one measure which would prevent an unwelcome owner buying up stakes in F1 in a bid to build up more than 50% and take control of the sport.

CVC has put other measures in place to prevent Delta Topco from being forced into default by its co-shareholders combining their stakes to form a group with more than 50.1%. The company's minority shareholders include Ecclestone, his Bambino family trust and three other funds – BlackRock, Waddell & Reed and Norges, the investment division of Norway's central bank. However, if any of them wants to sell, not only does CVC have to give approval but it also has right of first refusal.

Rumors of other companies taking control of F1 have only come up a few times since CVC bought the sport. Most recently, earlier this month it emerged that American billionaire John Malone's Liberty Media had teamed up with Discovery Communications to consider mounting a bid for Delta Topco. Ecclestone told Pitpass that he had "never heard anything about Liberty buying into F1. I don't know anything about it." A source close to the situation added that "there are no real discussions with Liberty and nothing is imminent anyway."

Perhaps more interestingly, the banks' veto would have been yet another hurdle for the supposed bid for F1 from Rupert Murdoch's beleaguered News Corporation in 2011. When the bid was rumored to be under consideration Pitpass outlined the many hurdles that it would face including likely opposition from News Corp shareholders and regulators. The Delta Topco debt covenants were confidential then so we were not aware that consent was also needed from the banks and there is no guarantee that they would have given it.

As the previous covenant was in force at that time, the most that News Corp could have acquired without the banks' agreement was 34.9% and that is assuming CVC would have been prepared to sell. It is yet another reason why News Corp's bid would have been doomed had it ever actually got off the grid. Pitpass.com

More delays for Red Bull in Bahrain
(GMM) Red Bull's troubles seemed to have carried over from Jerez, as Sebastian Vettel struggled to get up to speed in the troubled RB10 on Wednesday.

Two weeks after the Jerez calamity, the reigning world champions are back on track in Bahrain with designer Adrian Newey and Renault's fixes in place.

However, over four hours into the first day of the second official pre-season test, German Vettel had not even turned a lap.

"The car was still being assembled," said German correspondent Michael Schmidt.

"New parts were still arriving from England," he told Auto Motor und Sport.

Lotus E22

It is becoming clearer that many of Red Bull's problems are not engine supplier Renault's fault. On Wednesday, Renault-powered runners including Caterham and the Lotus were busily collecting laps.

The first public glimpse of the unique double-nosed 2014 Lotus, which also features an asymmetrically-positioned exhaust, can be seen to the right.

Asymmetical Exhaust

The asymmetrical exhaust image is to the left.

"I'm not saying that we have solved all of our problems," said Renault Sport's Remi Taffin, "but we should have a firm grip on what held us back at Jerez.

"We now have a base on which to build. Bahrain is our first test.

"Yes we could still have some problems, but we should be able to build upon this basis," he added.

Even Red Bull's always-blunt Dr Helmut Marko was on Wednesday not pointing the finger of blame in Renault's direction.

"Even if there had been no problems with the power unit," he said, "we would not have been running much in Jerez.

"It was our fault. Under the cover it was getting too hot, so we have brought two solutions here to Bahrain, which should help us."

At about 2pm Bahrain time, Vettel emerged from the pits for an installation lap, and he soon followed it up with an initial run of four laps.

Meanwhile, a photo of former Lotus boss Eric Boullier in McLaren grey in Bahrain can be seen here.

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