Formula One and the family of racing supremo Bernie Ecclestone have been hit with a £158m legal claim over an unpaid debt.
Switzerland's Kamos-Finanz is suing SLEC, F1's parent company, and Bambino Holdings, Mr Ecclestone's family trust, over a $235m (£124.5m) loan that SLEC took out five years ago. Bambino Holdings is a minority shareholder in SLEC.
Kamos-Finanz is demanding SLEC repay the loan in full and also pay interest. Bambino Holdings is being pursued for damages equivalent to interest on the loan. Together it makes Kamos-Finanz's total claim, which has been lodged with the High Court, worth £158m.
The loan dates back to April 2001, and industry insiders believe it helped fund the acqui- sition of the commercial rights to F1, which SLEC bought a day after the loan was taken out. The rights, SLEC's core asset, were acquired for $313.6m for 100 years from F1's governing body, the Fédération Internationale de l'Automobile (FIA). It is not known when the loan was due to be settled, nor why it has not been repaid yet. SLEC and Bambino declined to comment.
The news comes just after SLEC filed accounts for 2005. These show that Formula One Administration (FOA), the wholly owned SLEC subsidiary that holds the F1 rights, made pre- tax profits of $435m last year on revenues of $787m. SLEC is majority owned by CVC, which spent almost $1bn last November acquiring its stake. The private equity giant has won plaudits for its running of F1, ensuring that rebel car makers, which were threatening to set up their own championship, stayed with F1 beyond 2008.
The disputed Kamos-Finanz loan was taken out by SLEC well before CVC become involved in the company.
SLEC and Bambino Holdings - which is believed to be for the benefit of Mr Ecclestone's wife and children, and not him - have until 2 October to lodge defences against the claim.Reuse content