“Christian would be ideal,” Ecclestone told reporters in Interlagos, when speaking of his successor as CEO of the Formula 1 Group. “I would be happy to hold his hand. We could have a transitional period. It needs someone who knows the sport.
“If someone comes in from outside, a corporate type, I don’t think I could work with them. It wouldn’t last five minutes.”
Was he serious? Why was he saying this now? The comments by the 83 year old, made on the eve of the final race of the season, have intrigued everyone who works in the sport.
And yesterday Ferrari’s Luca di Montezemolo dismissed it as one of Ecclestone’s famous jokes, “As the years go by, he more and more enjoys making jokes and I’m happy he still has the desire to do so…” the Italian said. One often overlooked detail is that, as a member of the new F1 board and representative of the Longest Standing Team, Ferrari, Montezemolo has a say in the appointment of a new CEO.
It was the first time that Ecclestone had publicly anointed a successor. Privately he is known to have suggested his in house counsel Sacha Woodward Hill as a possible successor in the past, but CVC has been considering a number of candidates from business figures known to their group.
Ecclestone has controlled F1 with an iron grip for over 30 years. His vision for the distribution of TV rights, building a platform of live mass market coverage globally, has turned F1 into a business with in excess of $1.5 billion turnover annually. This divides up into TV rights, circuit hosting deals and other sponsorships. But the media landscape is changing fast and F1 has been forced to go to some pay platforms in key European markets recently, like UK, France and Italy, in order to find the money. This has impacted on the total live TV audience size. The years that lie ahead present as many challenges as opportunities.
The skills needed to run a media business like F1 are quite different from running a team.
CVC, the main shareholder, which bought a controlling interest in the sport in 2006 for $850 million, has already seen a four fold return on its investment and if it is able to float the business eventually, as planned, it expects that to be a 10 fold gain. According to the Financial Times, “CVC’s preliminary investment review, drawn up after initial due diligence on F1, suggested it could exit ‘in a range of 10 to 14 times ebitda.’ ” (Earnings before interest, tax, depreciation and amortisation)
But the last two weeks have seen a torch being shone into the recesses of the sport, as first Ecclestone and then last week CVC’s managing partner Donald MacKenzie appeared in the witness box at the High Court in a $170 million lawsuit, being brought against Ecclestone and other parties (but not CVC) over the sale of F1 from Bayern LB and other banks to CVC in 2006.
And in MacKenzie’s testimony he spelled out quite clearly that, although CVC satisfied itself that the $44 million payments Ecclestone made to Bayern LB’s Gerhard Gribkwosky were not bribes to sell the company on his terms, he was clear that if Ecclestone is found by the courts to have acted illegally they will fire him as CEO.
“We said we need to think of a replacement for Ecclestone,” MacKenzie added in the High Court. “It won’t be easy. And we’re still thinking of one, trying to find one.
“There have been many, many times where I thought I was going to lose all my money, right up until 2012,” he added. “This company has been an alarming company to own.”
The question of who might succeed Ecclestone has been front of mind for many in F1 for years, as the ringmaster reached and passed 80 years of age.
It is interesting that he anointed Horner as heir; the pair have become close in recent years and Red Bull has sided with Ecclestone on a number of key battlegrounds.
It’s a mug’s game trying to second guess Ecclestone’s motives, as often they are things that no-one could imagine. But in this case the anointing of Horner served several purposes.
First, on a basic level, it drew significant media attention to the final race of the season, which risked being overlooked with the championship already decided.
It was also a strong statement of being in control, after MacKenzie’s comments about firing him if he has done anything wrong.
It also showed that whatever happens in the legal processes that lie ahead of him, Ecclestone believes he will be in charge of selecting and mentoring his successor.