CART receives buy-out offer

Champ Car World Series sanctioning body CART has received a formal buy-out proposal from a consortium headed by several Champ Car team owners, including Gerald Forsythe

CART receives buy-out offer

Forsythe, along with PK Racing boss Kevin Kalkhoven, Rocketsports chief Paul Gentilozzi, Carl Russo and Motorock LLC, have formed a new holding company called Open Wheel Racing Series, which has issued a proposal to buy all outstanding CART shares for $0.50 each - a total of $7.4 million for the company. Shares in the company are currently trading at around $1.40 on the New York Stock Exchange, with the company valued at $27 million.

CART declined to sign the original letter of intent issued by the company, but has confirmed that it is in negotiations with the group regarding a possible acquisition. CART added that there are no assurances that the discussions will lead to the sale of the company.

Forsythe, whose driver Paul Tracy currently leads the Champ Car points standings, currently owns 3,377,400 shares of CART's common stock - around 22.9 percent. He has been rumoured to be organising a buy-out of the company for some time. In filings made to the US Securities and Exchange Commission, the group states that its long-term goal would be to increase the number of street races whilst phasing out oval events.

The sanctioning body has seen its cash reserves dwindle this year as it has lost money promoting events and funding race teams to ensure that 18 cars are on the grid for each race. It recently released its quarterly results, in which it announced that it had appointed a banking firm to investigate future options for the firm, which could include privatising the company.

Bernie Ecclestone is not involved in the bid.

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