Reuters: Private Equity: Formula One chairman to be rewarded with equity stake

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Formula One chairman to be rewarded with equity stake May 23rd 2012, 21:39 LONDON | Wed May 23, 2012 5:39pm EDT LONDON May 23 (Reuters) - Austrian Peter Brabeck, set to become non-executive chairman of the Formula One motor racing business as it prepares for flotation, will be rewarded with an equity stake potentially worth tens of millions of dollars, a source close to the deal said on Wednesday. Brabeck's appointment as non-executive chairman is expected to be confirmed at a board meeting in Monaco on Friday ahead of the Formula One Grand Prix there this weekend. Brabeck, 67, is chairman of Swiss food group Nestle after having served as its chief executive. Brabeck is expected to be offered a 0.5 percent stake in the business in return for an initial investment of some of his own money, the source said, confirming a report by Britain's Sky News. The stake will be subject to conditions linked to company performance and a lengthy lock-in before it can be accessed. Pay for senior business figures is a thorny issue in Britain, where a number of company shareholders have opposed deals that they see as too generous. The appointment of Brabeck is the latest step in preparing Formula One for a listing on the stock market in Singapore expected to go ahead in June. CVC Capital Partners, the main shareholder, said this week it had cut its stake to around 42 percent after selling part of Formula One to three investment groups for $1.6 billion cash. U.S. groups Waddell & Reed and BlackRock, along with Norway's Norges Bank Investment Management, acquired a 21 percent stake in the firm through the deal, seen as underpinning the IPO process. Formula One is a global series of 20 races each year that draw television audiences of more than 500 million. The sport has expanded from its European base to lucrative markets in Asia and the Middle East, and the Singapore listing would tap into Asian appetite for renowned brands. Link this Share this Digg this Email Reprints

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