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Formula One could fit with News Corp says Saudi investor

NEWS STORY
09/05/2012

CVC Capital, the private equity firm which owns the majority of F1, is accelerating ahead with its plan to float the sport on the Singapore stock exchange this year but as we all know, nothing is certain until the ink is dry on the contract. Indeed, as recently as March one sports reporter suggested that Rupert Murdoch's embattled media giant, News Corporation, could soon buy into F1. During the early part of last year News Corp was thought to be interested in taking over the sport but a phone-hacking scandal put the brakes on that. Nevertheless, one of News Corp's biggest hitters has not forgotten about the synergy which F1 would bring.

With hindsight, the saga of News Corp's interest in buying into F1 appears to have been a huge storm in a tea cup. When the initial reports about it emerged, Pitpass went to great lengths to explain why it would never happen with the most likely hurdle being opposition from the European Commission on the grounds that the takeover would be anti-competitive.

Pitpass' business editor Christian Sylt's suspicions were aroused at the time by the fact that the reports originated on the blog of Mark Kleinman, the city editor for Sky News which is ultimately controlled by News Corp. It got a flurry of media coverage but, as Pitpass recently reported, it has become another of Kleinman's reports which ultimately came to nothing. However, that does not mean to say there is no merit in the idea.

At the height of the talk about News Corp taking over F1 Sylt reported on Pitpass that a person who might have something to say about it is Saudi Arabian billionaire businessman Prince Alwaleed bin Talal. He is the second largest shareholder in News Corp after Murdoch himself and has become the world's 25th richest person with a fortune estimated at £12.8bn by investing in businesses including Apple, Disney and HP. He is one of Murdoch's closest allies but he is no fan of F1.

In 2002, when Sylt was working for F1 boss Bernie Ecclestone, he first met Alwaleed and they have remained in contact ever since. When Sylt asked him about F1 a decade ago he said "I am not interested in this kind of sport" and this was a particularly interesting comment since Alwaleed's son, Khaled, was in the process of trying to buy into a team. Khaled's first target was Prost and then Minardi but neither deal came off. It is hardly surprising that Alwaleed was not a fan of F1 as he held a stake in Kirch, the media company which was F1's owner until it went bust in 2002 with commentators saying that the sport contributed to its downfall as it had to take on a huge amount of debt to buy it. However, although Alwaleed is not a fan of F1 that doesn't mean to say that he can't see the benefit it brings.

Sylt recently spoke to Alwaleed about the phone-hacking scandal which has engulfed News Corp and its bid for F1 also came up in the conversation. Writing in today's Guardian he reveals that Alwaleed believes the phone hacking scandal "is not helping the name of News Corp" even though the company's interests extend way beyond newspapers and also include the 20th Century Fox movie studio, cable television networks and the book publisher Harper Collins.

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