Independent F1 Teams heading toward bankruptcy

Sources said that they "fear Formula One is headed slowly but surely towards a series formed of manufacturer and customer teams," according to Tom Cary of the London TELEGRAPH. The news that "private equity firm CVC Capital Partners, Formula One’s largest single shareholder," took a $865M dividend in '12 caused "much eyebrow-raising within the F1 paddock."

CVC, which paid roughly $1B for the sport in '06, has now gained more than $2B from it "in the last 24 months, while reducing its stake" from 63% to 35%. It has "been able to do that" because F1 CEO Bernie Ecclestone has "made the sport so commercially successful."

The figures "stand in stark contrast to the balance sheets of virtually every team from midway down the grid backwards." The "new commercial pact signed between the teams and Ecclestone" gives teams 63% of the profits — $751.8M last year — but it is estimated that 60% of that money "goes to the top five teams, with the next five sharing" the other 40%.

Marussia, which "finished 11th last year, only recently agreed a deal with Ecclestone and currently have no share of the revenues." Set "against the teams’ profits are costs which are set to rise sharply next year with the move to new turbo-charged V6 engines."

Toro Rosso Team Principal Franz Tost estimated that the move will cost independent teams an extra $15M-$20M. The decision to "host two tests out in Bahrain prior to the start of next season, and the return of in-season testing, will put a further strain on resources." TELEGRAPH