Liberty Media CEO Greg Maffei commented on the alleged $20 billion offer from the Saudi Arabian investment fund, PIF, which sought to acquire the commercial rights of Formula 1 towards the end of the 2022 season. According to the American entrepreneur, however, the value of the premier open-wheel racing brand is worth much more than the proposed amount from the Arabs.
Liberty Media: Greg Maffei demands much more than the $20 billion offer from PIF
“We are a C Corp. That means if we sell a division, we pay corporate income tax, and then all the proceeds that would be distributed to our shareholders would also be subject to taxes,” Greg Maffei stated on the Walker Webcast.
“If we were to separate Formula 1, create a separate company, and wait for a sufficient period of time without any plans or intentions to sell, that business could be sold in the future, and there would be no corporate-level tax. So, the way we are structured today, given the tax basis, we wouldn’t be sellers.” – he explained.
Greg Maffei’s position is very clear, confirming that he has absolutely no intention of selling in the short term. Liberty Media acquired the commercial rights of Formula 1 in 2017 from Bernie Ecclestone for a sum of $4.2 billion. Since then, the growth of the brand has been remarkable.
“If we wanted to be sellers, or even just consider it, we would have to execute a spin-off operation,” Greg Maffei continued. “Apart from that, there are other reasons why we might do it. It’s not just for a sale, but the way we are structured would be very unattractive.”
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“I’ve already said publicly, the Saudis have been partners in a couple of things: they have a race there. Aramco is a sponsor, but they have never contacted us. And frankly, $20 billion wouldn’t be an interesting price. It’s valued at 17/18 [billion], why $20 billion? I want much more! We are quite optimistic about the future.” – he pointed out.
In just a few years, thanks to complete openness towards social media, the TV series “Drive To Survive,” and various shows during race weekends and beyond, the brand value has grown exponentially, attracting the attention of the Arabs. On the other hand, the Saudi Arabian investment fund PIF (Public Investment Fund), in fact, reportedly offered a figure five times higher than the amount required to purchase the rights in 2017. However, Greg Maffei promptly rejected the offer.
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