Formula One outfit Mercedes AMG Petronas has pledged its commitment to the sport and urged F1’s ownership group, CVC Capital Partners, to step up Concorde Agreement talks with the team in a bid to maximise the benefit of the long-mooted stock market flotation.
Formula One’s commercial rights-holder Bernie Ecclestone in March said the majority of the championship’s teams, including Ferrari, McLaren and Red Bull Racing, had reached an agreement to continue racing after the current Concorde Agreement expires at the end of this season. The confidential Agreement between Ecclestone’s Formula One Management (FOM) and the teams divides up the commercial revenues of the sport, including television rights and prize money.
However, Mercedes is the only leading team yet to have reached a deal with FOM and Autosport reported that the German marque may be willing to challenge the terms offered to it under EU anti-competition law – if an agreement is not reached soon. A report this week also stated that Mercedes was considering withdrawing from the sport. Either move would severely damage the mooted US$2 billion initial public offering (IPO) of Formula One on the Singapore Stock Exchange, which is being planned for later this year.
Mercedes CEO Pat Fry has maintained the team has no desire to exit F1, but he added to Autosport: “If CVC wish to float F1, I think they need this (Concorde talks) resolved fairly quickly – possibly more than we need it resolved. Discussions continue, but progress is not as strong as I would like.” Indications that Mercedes have no intention of withdrawing were made this week as the team sealed new commercial deals with Starwood Hotels and watchmaker IWC that run into the 2013 season. However, Fry is also aware of the value of the Mercedes-Benz brand to the sport itself.
“The mindset is absolutely in capital letters: Mercedes-Benz wishes to be in F1,” he said. “I would also say that F1 also needs Mercedes-Benz. It is one of the top 20 brands globally and is one of the few car manufacturers in F1; it is an engine supplier to three teams. It can attract brands like Starwood Hotels, a huge American company that takes these decisions very seriously, and I think Mercedes wants to be in F1. F1 definitely would be much the poorer if Mercedes was not a participant, and I am completely convinced in my mind that if CVC wish to sell some or all of F1, the value they can derive from that would be severely diminished if Mercedes was not a participant.”
Mercedes maintains commitment to F1