F1 shareholder goes broke
Lehman Brothers first became involved in F1 because of the bankruptcy of Kirch Media in 2002, when it acquired shares instead of waiting for debts to be repaid. Lehman continued to hold shares in the business until March 2006 when CVC Capital Partners bought them out, but as part of that deal Lehman had an option to buy a stake in Delta Topco, the new ownership vehicle of the Formula One business. CVC has the first option to buy the Lehman shares.
Lehman Brothers later decided to become involved as a lender to the Formula One group as well, buying some of the debts that the company had with the Royal Bank of Scotland. The Formula One group's debt to Lehman is believed to be in the region of $1.2bn. The bankruptcy may create an opportunity for the Formula One group to negotiate a discount with the Lehman administrators in exchange for a rapid payment, although that would involve borrowing more money from another lender. Grandprix.com
09/15/08 (GMM) Formula one shareholder Lehman Brothers has filed for bankruptcy, proving that the sport is not immune to the current global financial crisis.
With 16.8 per cent, the New York-based investment bank is F1's second largest shareholder, behind CVC.