Formula 1 has been granted an amendment of the conditions on a $2.9b loan in order to help it weather the COVID-19 pandemic, it was announced on Monday.
Under both the amended loan and an attached $500m credit facility, Formula 1’s owners Liberty Media will be allowed a greater debt-to-profit ratio in order to compensate for the loss of revenues in the coronavirus-affected 2020 season.
In a statement accompanying the announcement, Liberty explained that “subject to compliance by F1 with certain additional conditions, the net leverage financial covenant shall not apply until 1 January 2022”, meaning F1 will not have to comply with the original terms of the loan until that date.
“Formula 1 remains the pinnacle of motorsport as it celebrates its 70th anniversary,” said Liberty CEO Chase Carey. “This new flexibility in our debt covenants, along with a strong balance sheet and ample liquidity, will enable us to weather this difficult time and we are excited to start the season in Austria on 3-5 July.” – he concluded.