Bank Claims F1 Control in Settlement
A group of three banks has wrested control over the companies controlling Formula One's commercial rights from supremo Bernie Ecclestone, the German state bank BayernLB said
In a settlement agreed on Wednesday, which put an end to a three-year legal battle, Ecclestone has effectively given in to all demands from the banks, which have pooled their interest in the Speed Investments holding company, BayernLB added.
The banks, BayernLB, JP Morgan and Lehman Brothers, own 75 percent of Formula One holding company SLEC and wanted their stake translated into influence over Ecclestone's operating companies, like Formula One Administration (FOA).
"Speed, as majority owner of SLEC, has regained the influence that corresponds to the shareholding structure with this deal," said BayernLB board member Gerhard Gribkowsky in a statement. "Speed will use this influence on the operating level in a contructive and responsible manner, and in the interest of all parties."
The bank, controlled by the German state of Bavaria, said the deal settled all legal action between them and 74-year old Ecclestone and his Bambino Holding company.
The group of banks owned their stake in SLEC after the collapse of Germany's Kirch media group, which had borrowed some $1.6 billion from them. BayernLB, as Kirch's biggest creditor, now has the biggest stake among them.
The banks' battle against Ecclestone has been followed closely by carmakers who are threatening to launch a rival series from 2008 if they do not get a greater share of Formula One's commercial income.
Sources close to the banks and the Formula One carmakers' association, which includes DaimlerChrysler, BMW and Renault, said the settlement made a deal avoiding such a split more likely.
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