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The American company, which owns the commercial rights to Formula 1, announced in April plans to acquire the two-wheeled world championship.
It was a transaction valued at $6.9 billion and, if approved, will leave Liberty with an approximately 86 percent stake in MotoGP’s parent company, Dorna.
To proceed, the deal required a number of approvals in an array of markets, including Australia.
Those were largely foreign investment authorities, though the European Commission was also required to sign off on the transaction, given the size of the organisations involved and the potential impact on the European market.
That process remains ongoing following the announcement on Thursday that it has launched an “in-depth investigation” into the proposed purchase.
Liberty Media had hoped to conclude the deal by the end of 2024, but the investigation has delayed that until May 2025.
As a result, Liberty Media is now obliged to pay €126 million simply to keep the deal alive.
That figure is in addition to the agreed sale price does not reduce or offset that consideration, and purely and opens the window for the transaction to complete until June 30.
Liberty Media issued a statement acknowledging the delay resulting from the European Commission’s interest.
MotoGP sale on hold as “in-depth investigation” launched into $6.9 billion deal
“Liberty Media today received notice from the European Commission opening a Phase II investigation into its previously announced acquisition of MotoGP,” it announced.
“We are confident this transaction will benefit MotoGP’s business, fans, viewers and the broader motorcycle industry.
“Market participants have widely recognized the benefits of the transaction.
“There is a very large and growing market for audiovisual entertainment well beyond sports, and this transaction will enhance MotoGP’s ability to compete in this highly competitive market.
“We will continue to work with the European Commission as they progress their review and have agreed with the sellers to an extension of the longstop date to June 30, 2025 in order to accommodate the more in-depth investigation.
“We believe that the European Commission will conclude that the transaction should be approved.”
The European Commission also released a statement outlining its concerns with the transaction.
“The transaction raises serious competition concerns in potential narrow national markets for the licensing of broadcasting rights for motorsports content in the European Economic Area (‘EEA’), where Formula 1 is the clear market leader in all European countries and MotoGP is most often its only competitor,” it stated.
“The transaction may remove important competitive constraints between the parties on some potential wider national markets for the licensing of broadcasting rights for all sports content or possible segments of such markets.
“In particular, this is because it appears that Formula 1 and MotoGP compete closely.”
Teresa Ribera, executive vice-president for clean, just and competition transition, added: “By acquiring Dorna Sports, Liberty Media would hold the commercial rights to two of the most popular motorsports in Europe: Formula 1 and MotoGP.
“We need to more carefully assess whether this acquisition could negatively affect European broadcasters, for example in terms of increased license fees, and ultimately European consumers and motorsports fans through higher prices.
“We will at the same time openly consider any substantiated claims by the parties about possible benefits this acquisition might bring, for fans, the industry and for consumers.”
The Phase II investigation has until May 14 to make its decision at which point the deal could be unconditionally cleared, approved subject to remedies, or prohibited “if no adequate remedies to the competition concerns have been proposed by the merging parties.”
Liberty Media is required to pay the €126 million fee on January 2 or January 3.
(Exchange rate €1 = AUD $1.66)
