Liberty Media Corp. Announces Agreements with Third Party Investors to Invest $1.55 Billion to Support Formula 1 Acquisition
December 14 2016 - 8:30AM
Business Wire
Liberty Media Corporation (“Liberty Media”) (NASDAQ: LSXMA,
LSXMB, LSXMK, BATRA, BATRK, LMCA, LMCK) announced today that it has
entered into agreements with certain third party investors to
commit $1.55 billion in subscriptions for newly issued shares of
its Series C Liberty Media common stock (“LMCK”) at a price of
$25.00 per share in connection with its acquisition of Formula 1.
The third parties are Coatue Management, L.L.C., the D. E. Shaw
group, JANA Partners LLC, Ruane, Cunniff & Goldfarb Inc.,
Soroban Capital Partners LP, SPO Advisory Corp., and Viking Global
Investors LP (collectively the “Third Party Investors”). The
issuance of the shares of LMCK to the Third Party Investors will be
consummated concurrently with the completion of the Formula 1
acquisition.
Greg Maffei, President and Chief Executive Officer of Liberty
Media, said: "We are excited that this impressive list of investors
will participate in the acquisition of Formula 1. This group shares
our enthusiasm for the sport and our belief in the opportunity to
develop and grow it for the benefit of the fans, teams, sponsors
and our shareholders. We look forward to closing the transaction in
early 2017.”
Chase Carey, Chairman of Formula 1, said: “This is a significant
step in Liberty Media’s transformative acquisition of Formula 1 and
is further confirmation that the future of the sport is
bright.”
The proceeds from this $1.55 billion investment will be used to
increase the cash portion of the aggregate consideration payable to
the consortium of selling Formula 1 shareholders (the “Selling
Shareholders”) led by CVC Capital Partners (“CVC”). As a result of
this investment, the number of LMCK shares issuable to the Selling
Shareholders at the closing of the Formula 1 acquisition will be
reduced from approximately 138 million to approximately 76 million.
The total number of LMCK shares to be issued by Liberty Media in
connection with the acquisition of Formula 1, to both the Selling
Shareholders and the Third Party Investors, remains unchanged at
approximately 138 million shares (excluding the dilutive impact of
the $351 million Exchangeable Notes). Both the Third Party
Investors and the Selling Shareholders will be subject to certain
lock-up restrictions for a period of six months following the
completion of the Formula 1 acquisition, subject to certain
exceptions. Information regarding these lock-up restrictions can be
found in the definitive proxy statement filed by Liberty Media with
respect to the special meeting of stockholders (described below)
and in a future Current Report on Form 8-K to be filed by Liberty
Media.
The interest in Formula 1 already acquired by Liberty
Media, and the remaining interest to be acquired upon the closing
of the acquisition, is being attributed to the Liberty Media
Group tracking stock. Upon completion of the acquisition,
subject to stockholder approval, the Liberty Media Group will be
renamed the Formula One Group and the ticker symbols for the Series
A, Series B and Series C Liberty Media common stocks will be
changed from LMC (A/B/K), respectively, to FWON (A/B/K),
respectively.
Following the completion of the Formula 1 acquisition and the
issuance of shares to the Third Party Investors, the Third Party
Investors in the aggregate will own approximately 26%(1) of the
Formula One Group’s equity, and the Selling Shareholders will own
approximately 39%(1) of the Formula One Group's equity and will
have board representation at Formula 1 to support Liberty Media in
continuing to develop the full potential of the sport. In addition,
a CVC representative will be joining the Liberty Media Board of
Directors.
The completion of the acquisition is subject to certain
conditions, including the receipt of (i) certain clearances and
approvals by antitrust and competition law authorities in various
countries, (ii) certain third-party consents and approvals,
including that of the Fédération Internationale de l'Automobile,
the governing body of Formula 1, and (iii) the approval by Liberty
Media's stockholders of the issuance of LMCK shares in connection
with the acquisition (including the issuance to the Third Party
Investors) at the special meeting scheduled for January 17, 2017.
The acquisition is expected to close before the end of the first
quarter in 2017. At the special meeting, Liberty Media’s
stockholders will also be asked to approve the name change of the
Liberty Media Group to the Formula One Group. However, the approval
of the name change proposal is not a condition to closing the
Formula 1 acquisition. Additional information regarding the
acquisition and Formula 1 has been included in the definitive proxy
materials filed by Liberty Media with the Securities and Exchange
Commission relating to the matters to be voted upon by Liberty
Media's stockholders described above.
Forward-Looking Statements
This press release includes certain forward-looking statements
within the meaning of the Private Securities Litigation Reform Act
of 1995, including statements relating to the proposed acquisition
of Formula 1 and its expected timing, the related third party
investments in Liberty Media, the renaming of the Liberty Media
Group and the corresponding change in ticker symbols and other
matters that are not historical facts. These forward-looking
statements involve many risks and uncertainties that could cause
actual results to differ materially from those expressed or implied
by such statements, including, without limitation, the satisfaction
of conditions to the proposed acquisition of Formula 1. These
forward looking statements speak only as of the date of this press
release, and Liberty expressly disclaims any obligation or
undertaking to disseminate any updates or revisions to any
forward-looking statement contained herein to reflect any change in
Liberty Media's expectations with regard thereto or any change in
events, conditions or circumstances on which any such statement is
based. Please refer to the publicly filed documents of Liberty
Media, including its most recent Annual Report on Form 10-K and
Quarterly Reports on Form 10-Q, for risks and uncertainties related
to Liberty Media's business which may affect the statements made in
this press release.
Additional Information
Nothing in this press release shall constitute a solicitation to
buy or an offer to sell shares of Liberty Media’s Series
C Liberty Media common stock or any other series of its common
stock. Liberty Media stockholders and other investors are urged to
read the definitive proxy statement (which has been filed with the
SEC) because it contains important information relating to the
proposed acquisition of Formula 1. Copies of Liberty Media’s SEC
filings are available free of charge at the SEC’s website
(http://www.sec.gov). Copies of the filings together with the
materials incorporated by reference therein will also be available,
without charge, by directing a request to Investor Relations, (720)
875-5420.
Participants in the
Solicitation
The directors and executive officers of Liberty Media and other
persons may be deemed to be participants in the solicitation of
proxies in respect of any proposals relating to the proposed
acquisition of Formula 1. Information regarding the directors and
executive officers of Liberty Media is available in its definitive
proxy statement, which was filed with the SEC on July 8, 2016, and
certain of its Current Reports on Form 8-K. Other information
regarding the participants in the proxy solicitation and a
description of their direct and indirect interests, by security
holdings or otherwise, has been made available in the definitive
proxy materials regarding the proposed acquisition of Formula 1
(which have been filed with the SEC). Free copies of these
documents may be obtained as described in the preceding
paragraph.
About Liberty Media Corporation
Liberty Media Corporation operates and owns interests in a broad
range of media, communications and entertainment businesses. Those
businesses are attributed to three tracking stock groups: the
Liberty SiriusXM Group, the Braves Group and the Liberty Media
Group. The businesses and assets attributed to the Liberty SiriusXM
Group (Nasdaq: LSXMA, LSXMB, LSXMK) include Liberty Media
Corporation’s interest in SiriusXM. The businesses and assets
attributed to the Braves Group (Nasdaq: BATRA, BATRK) include
Liberty Media Corporation’s subsidiary Braves Holdings, LLC. The
businesses and assets attributed to the Liberty Media Group
(Nasdaq: LMCA, LMCK) consist of all of Liberty Media Corporation's
businesses and assets other than those attributed to the Liberty
SiriusXM Group and the Braves Group, including its interests in
Live Nation Entertainment and Formula 1, and minority equity
investments in Time Warner Inc. and Viacom.
(1) Calculated based on the undiluted share count as of
10/31/2016 and is inclusive of the dilutive impact of the $351
million Exchangeable Notes.
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