Liberty Media buys MotoGP rights holder Dorna Sports

The American group Liberty Media Corporation has closed an agreement with Bridgepoint and CPP Investments to acquire Dorna Sports. MotoGP will thus join Liberty's portfolio of Formula 1 rights.

Since its first season in 1949, which saw six rounds held across Europe, MotoGP has grown significantly and will host 21 races in 17 countries in the 2024 season. The business benefits from an attractive financial profile with diversified and contracted revenue streams, high EBITDA margins and low capital intensity resulting in significant free cash flow. Carmelo Ezpeleta, CEO of Dorna since 1994, will continue to direct Dorna Sports, maintaining its headquarters in Spain.

Founded in 1992 under the auspices of the ill-fated Banesto, the company was sold to CVC Capital Partners in 1998, gaining great international projection and renaming itself Dorna Sports. In 2006, the investment fund Bridgepoint Capital became a majority shareholder.

“We are delighted to expand our portfolio of live sports and entertainment assets with the acquisition of MotoGP,” he said. Greg Maffei, president and CEO of Liberty Media. "MotoGP is a global league with a loyal and enthusiastic fan base, captivating racing and a highly cash-flow generative financial profile. Carmelo and his management team have built a great sporting spectacle that we can expand to a wider global audience. The business has significant upside, and we intend to grow the sport for MotoGP fans, the teams, commercial partners and our shareholders."

For his part, Ezpeleta says: "This is the perfect next step in the evolution of MotoGP, and we are excited by what this milestone brings to Dorna, the MotoGP paddock and racing fans. We are proud of the global sport we have grown, and this transaction is a testament to the value of the sport today and its growth potential. Liberty has an incredible track record in developing sporting assets and we couldn't wish for a better partner to expand the MotoGP fan base across the globe. world.”

The group led by magnate John Malone will acquire 86% of MotoGP, while MotoGP management will retain approximately 14% of their participation in the business. The transaction reflects a enterprise value for MotoGP of 4.2 billion of euros and an equity value of 3.5 billion euros, with the balance of MotoGP's existing debt expected to remain after closing.

The equity consideration to the sellers is expected to be comprised of approximately 65% ​​cash, 21% Liberty Formula One Series C common shares and 14% shares held by MotoGP management. The cash consideration will be funded with a combination of cash and debt, subject to market conditions.

The consideration in FWONK shares will be valued based on the 20-day volume-weighted average price prior to the closing of the transaction.

This acquisition will be completed by the end of 2024 and is subject to receipt of authorizations and approvals by the competition authorities and foreign investment in various jurisdictions. It is noteworthy that on some occasion the European Commission had warned of the possibility that the two motorsport competitions, Formula One and MotoGP, would fall into the same hands.