Archer nas now sold Supercars

[Roadways6]

I don't get the whole "we need to buy the teams out to gain complete control" talk. If you buy 65% of any business you have complete control to do whatever you want, the 35% can't do jack!

It appears that although they teams only have 35%, they have a lot of rights built in to that 35%, including seemingly the power to veto any deal done for the 65% Archer share.

[Joe5619]

I don't get the whole "we need to buy the teams out to gain complete control" talk. If you buy 65% of any business you have complete control to do whatever you want, the 35% can't do jack!

It appears that although they teams only have 35%, they have a lot of rights built in to that 35%, including seemingly the power to veto any deal done for the 65% Archer share.

Archer really got screw on this deal from the beginning to the eventual end!! Why would you buy 65% of any business & still not have complete power is a very very very bad deal to say the least. I can't see anyone dumb enough to sign those terms again.

[stevo qld]

If Archer purchased 60% and the teams have 35%. is there another 5% owner lurking in the wings and keeping very quiet?

If so, is that 5% owner involved in a buyout consortium?

PS: Archer were not screwed by the seller. They were screwed by their own supposedly highly talented and well paid analytical brains trust.

Anyone who has invested in shares know that mostly, you win some and lose some and then claim a tax deduction for the loss.

[skaifeman]

Also depends on what turnover they made year to year.

[stevo qld]

The contest for the V8 Supercars business is understood to have narrowed to one party, which has lobbed its final offer and is waiting to hear from owner Archer Capital if it is the successful buyer.

The Australian Racing Group consortium and the TGI Sport consortium have joined forces to form one proposal after earlier competing with each other for the business, which is up for sale through Miles Advisory.

ARG is owned by Brian Boyd and John McMellan from Payce Property, along with well-known racing identities Garry and Barry Rogers.

The TGI Sport consortium also includes TLA Worldwide, run by Craig Kelly and Mark Skaife.

Funding the offer is TGI's US-based owner Bruin Sports Capital.

The understanding is that the offer came in around the $60m mark.

Earlier, there was talk that Australian businessman Peter Adderton was partnering with NRL team the Brisbane Broncos to buy Supercars, but the thinking is that they are no longer in the mix.

Miles Advisory is now believe to be in discussions with the teams about the proposals.

One theory is that the bidder may have promised team owners $700,000 per season per racing entitlement contract.

V8 Supercars is among sporting events hard hit by the global pandemic, with its marquee event for the year, the Bathurst 1000, pushed back from October to November and earnings being severely hit.

Miles originally helped sell a majority stake in the V8 Supercars business to Archer in 2011 for a price that valued it at about $300m.

The supercars teams themselves own the remaining minority stake.

The understanding is that V8 has been making about $23m in annual earnings before interest, tax, depreciation and amortisation, but that was before the recent lockdowns to try to stem the spread of the Covid-19 Delta variant.

Much of the earnings winds up in the hands of the racing teams, according to industry analysts.

The broadcasting rights of V8, which are held by Seven and Fox Sports, are seen as a valuable part of the operation.

https://www.theaustralian.com.au/business/dataroom/v8-supercars-contest-on-the-home-straight/news-story/52b9bf0144d038a9233c3d06a0d05add


Much later: (the next month)

I have been pondering about the numerical (percentage) relative ownership of ALL the parties involved in previous bids.

If the bids do combine it will force down the price for Archer, but there are other ramifications.

Will the new consortium parties stump up the alleged $60Million or will they borrow the money? (Maybe from Archer)


The BIG questions to me are who will be the head honcho/CEO??
Who will have the largest shareholding?
Who will be on the board and who will be the Chairman??

[Troy01505]

If Archer purchased 60% and the teams have 35%. is there another 5% owner lurking in the wings and keeping very quiet?

If so, is that 5% owner involved in a buyout consortium?

PS: Archer were not screwed by the seller. They were screwed by their own supposedly highly talented and well paid analytical brains trust.

Anyone who has invested in shares know that mostly, you win some and lose some and then claim a tax deduction for the loss.

Cochrane may be the man with 5%.

[Roadways6]

Not just Cochrane but Warburton has a share of the 5% too IIRC

[stevo qld]

https://www.theaustralian.com.au/business/companies/supercars-value-falls-200m-after-sale-confirms-big-hit-taken-by-private-equity-outfit-archer-capital/news-story/8d62a3d13513f786c53297f51f2cac78

Supercars value falls $200m after sale confirms big hit taken by private equity outfit Archer Capital


Profits for the Supercars motor racing series have been falling as the sport takes a Covid hit.
EXCLUSIVE
JOHN STENSHOLT
EDITOR, THE LIST
@JohnStensholt

2 HOURS AGO OCTOBER 14, 2021


Private equity outfit Archer Capital has taken the bulk of a $200m hit on the Supercars motor racing series, with a new ownership group set to take control in a deal representing less than one-third of its previous sale value.

In a transaction set to be announced as soon as Friday, Supercars will be sold in a $100.3m deal to The Australian Racing Group consortium and the TGI Sport consortium, which have joined forces to form one proposal after earlier competing against each other. About $57m of the deal will go to Archer, which paid about $180m to take a 60 per cent stake in Supercars in 2011 that valued the series at about $305m.

The remaining $35m will flow to the team owners over the next few years, as part of their racing entitlement contracts (RECs).

The deal was previously foreshadowed by The Australian's DataRoom column. Sale documents obtained by The Australian show that the new owners are buying a business that has also suffered a similar hit in profit over the past decade.

Under previous majority owners Sport & Entertainment Limited, Supercars achieved earnings before interest, tax, depreciation and amortisation of about $32m-$34m.

Documents seen by The Australian show that Supercars recorded "EBITDA before appearance and grid fees" of $23.8m from $118m revenue in 2019, the last completed year of racing that was not interrupted by Covid-19.


Those figures dropped to ­EBITDA before appearance and grid fees (which would run into the millions of dollars annually) of $18.5m from revenue of $55m in 2020 and then a projected $22.1m from $93.1m in the current 2021 year.

The most lucrative race on the Supercars calendar each year is the Bathurst 1000 event, which this year has been delayed until the first weekend of December due to Covid-19 and will take place after four races at Sydney's Eastern Creek from late this month and through most of November.

Various scenarios regarding future profit when a more consistent season can run are also included in the document, ranging from $110m revenue and EBIT of $24.4m in a 13-race season through to a 15-race championship that would generate $124.1m revenue and EBIT of $32.2m.

The sale documents claims ­future growth will be generated by "improving awareness around event schedule" and "additional government supported events" in Australia and New Zealand.

Supercars' new owners also believe they can tap into digital viewer demand for the racing ­series via a "digital transformation to broaden viewership reach and expand content offering", and also negotiate more ­lucrative broadcast and streaming services deals while enhancing "Supercars non-racing content via reality programs, documentaries and e-series".

The new owners were also undertaking a $25m capital raising led by advisory firm Henslow, with investors taking a large slice of the raising offered board seats and personalised VIP experiences at selected Supercars events.

Ordinary shareholders would be entitled to participate in dividends up to the first $2.5m of free cashflow. The overall structure would also include $35m of third-party debt.

A category of "value-add" shareholders would provide $6m in services such as billboards, radio promotion and industry ­expertise for two years before gaining ordinary shares.

Business and sporting identities that will be involved in the new ownership group include former QSM Media boss Barclay Nettlefold, respected former IMG Australia head Martin Jolly, TLA Australia chief executive Craig Kelly and champion racing driver turned commentator Mark Skaife.

Mr Kelly, a former Collingwood AFL premiership winner, has become one of the nation's most powerful sports management figures, with his TLA involved in various commercial and promotional projects with ­almost every major Australian sporting competition.

Australian Racing Group is owned by Brian Boyd and John McMellan from Payce Property and Payce Security, along with well-known racing identities Garry and Barry ­Rogers.

The TGI Sport consortium also includes TLA Worldwide with funding from TGI's US-based owner, Bruin Sports ­Capital.

JOHN STENSHOLT EDITOR,

[hsv8fan]

This looks to me like a back in for GRM as an owner of the series and a rec to spare. Thanks very much I'll have that and get my team going again.

[Westfield]

We can only hope. I miss GRM. 😏 I trust Brian Boyd, John McMellan, and the Rodgers family but the rest of the consortium worries me. I have no love for Adderton or Terry Morris, but I respect their intention.

BTW, surely the new owners have realised that Gen 3 doesn't really solve any problems. I am yet to hear any reason why TA2 wouldn't work. If you must "Australianise"  them, then more power,  better tyres and MARC uprights would make them different, but still cheap to repair or replace.

[LG]

A done deal apparently...

https://autoaction.com.au/2021/10/28/supercars-sale-done-deal

[Ninnyman]

We can only hope. I miss GRM. 😏 I trust Brian Boyd, John McMellan, and the Rodgers family but the rest of the consortium worries me. I have no love for Adderton or Terry Morris, but I respect their intention.

Adderton and Morris were involved in the losing consortium, so there's no need to worry about them Westfield

[Westfield]

I acknowledge that Morris and Adderton "lost", but it doesn't mean that I don't respect their intentions. A lot of their ideas appear in the final deal anyway....

[stevo qld]

There is still a bit of uncertainty over the final structure of R.A.C.E. and the Board.

Two major Supercar publications are naming a different chairman.

Some of the consortium names seem to have been lost from stories.

There was an alleged $25 million dollar input from a late unnamed participant, who may or may not have displaced others.

(Not complete  references, that would be too numerous. Look at Speedcafe and Auto Action for starters.)

There is not even a statement on the desired number of Racing Charters to be issued. (More please )

https://www.speedcafe.com/category/news/
https://www.speedcafe.com/2021/10/28/five-key-questions-the-sale-of-supercars/
https://autoaction.com.au/
https://autoaction.com.au/2021/10/28/supercars-sale-done-deal

[Roadways6]

I acknowledge that Morris and Adderton "lost", but it doesn't mean that I don't respect their intentions. A lot of their ideas appear in the final deal anyway....

Until they brought in News Limited, I was all for the Adderton consortium

The mob that have now got it now aren't a positive in my opinion