U.S. Media Giant Liberty Media to Buy Formula One Racing

Liberty Media Corp., a Colorado-based mass media company, has agreed to buy control of the Formula One racing series for $4.4 billion ($3.9 billion).

The company will first acquire an 18.7% stake in F1 from CVC Capital Partners SA , the Luxembourg-based private equity firm that currently controls F1. Pending regulatory approval, Liberty Media intends to acquire the entire organization—including $4.1 billion ($3.6 billion) in F1 debt—in early 2017.

CVC acquired 63% ownership of the racing franchise in 2006. It reduced its stake to about 36% in 2012.

FI generates an estimated $1.5 billion in annual revenue. This year the series is staging races at a record 21 venues, which reportedly pay an average of about $26 million to host a race.

Chase Carey, executive vice president of film studio 21st Century Fox, will become chairman of F1 when the sale is completed. Bernie Ecclestone, who has run the F1 for decades, will continue as CEO for three years.

When the purchase is completed, Liberty Media plans to change its name to Formula One Group. CVC will own about 65% of the renamed company but won’t have control of its voting shares.