Progress towards the planned pounds 2bn flotation of the Formula One grand prix empire is attracting growing concern in the City after the apparent reluctance of Bernie Ecclestone, owner of the promotional operation, to disclose details of the business.
In an unusual move, Mr Ecclestone is understood to have ordered that circulation of research notes written by the select group of City analysts invited to follow the flotation is restricted to a small number of big institutional investors. It means the first chance to study details of the businesses, to be grouped into a Formula One holding company, will be when the formal prospectus document is published by Salomon Brothers, the US investment bank managing the flotation. In most flotations these research notes are circulated widely, giving an early opportunity to value a company prior to the publication of the prospectus itself.
Separately yesterday Christian Purslow of Salomon Brothers, which is handling the offer, said he could not confirm whether the float would take place at all. "We are just working away on this and I cannot say whether there will or won't be a flotation, though we expect to make an announcement in the near future." Mr Purslow said the "tentative" timetable agreed with Mr Ecclestone, thought to be to float the business at the British Grand Prix on 13 July, had not changed.
Salomon Brothers have already raised eyebrows in some City circles by effectively excluding analysts from some well-known broking houses from progress briefings on the flotations. Those analysts invited into the "inner circle" to meet Mr Ecclestone are from securities houses and merchant banks which are also sub-underwriters to the float itself. A similar procedure was used during the flotation of British Sky Broadcasting.
Details of Formula One revenues have been closely awaited in the City and in motor racing circles, because most of his deals to sell exclusive television rights for grand prix races have until now been a closely guarded secret. Intensive negotations have continued between Salomon Brothers, Mr Ecclestone and the Stock Exchange over how much or how little of this information is laid out in the prospectus. At issue is how much each cash television company pays to broadcast races, facts which would be a pre- requisite for an accurate valuation of the business before a flotation.
The latest obstacle in the way of the increasingly complex public offering came as the leading teams have continued to demand a more substantial stake in the floated company. Salomon Brothers' most recent plan was to sell around 50 per cent to public, with Mr Ecclestone keeping a 30 per cent stake and 10 per cent each going to the teams and to the sport's governing body.