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Owner of Formula 1, Liberty Media presented its argument for why it believes its acquisition of MotoGP will receive approval from competition regulators, despite a previous case questioning joint ownership of MotoGP and F1. Liberty has been considering the purchase of MotoGP promoter, Dorna Sports, for some time, but concerns have been raised about potential violations of the European Union’s antitrust policies. This concern stems from a previous case in 2006, when private equity group CVC Capital Partners bought the majority of Formula One Group’s shares while still owning MotoGP promoter, Dorna. To complete the acquisition of F1, CVC had to divest its stake in Dorna due to competition concerns. These concerns were highlighted in the decision to approve the F1 acquisition by CVC, signed then by European Commissioner for Competition, Neelie Kroes. The decision was based on the lack of significant overlap between F1 and MotoGP in terms of motor sport regulators, advertisers, participating teams/manufacturers, and circuits. However, there was significant overlap in TV rights markets, especially in Spain and Italy, where F1 and MotoGP were seen as closer substitutes to each other. This raised concerns about potential price increases for TV rights and a reduction in consumer choice. Despite these concerns, CVC’s commitments were deemed sufficient to eliminate the risk. It should be noted that the impact on free-to-air TV markets was emphasized, as both F1 and MotoGP business models heavily relied on their presence on free-to-air TV. The recent announcement of Liberty Media’s investment in Dorna, acquiring an 86% stake, is subject to regulatory approval. CEO Greg Maffei expressed confidence that regulatory permission will be granted, citing market changes since the 2006 case and emphasizing that F1 and MotoGP are separate properties that will not be bundled together. Liberty plans to engage quickly with regulators and highlight changes in the media landscape over the past 20 years. The company will seek antitrust clearance from relevant EU, UK, Brazil, and Australia bodies, and will also make foreign direct investment requests in Spain and Italy to address public interest concerns. Unlike CVC, Liberty Media is not under the same time pressures and believes the regulatory process will proceed smoothly and swiftly.
