F1 News: McLaren CEO Puts Staggering £1 Billion Valuation On Formula One Teams

McLaren CEO Zak Brown claims that many of the current Formula One teams are valued above £1 billion.

McLaren CEO Zak Brown has recently declared that the financial worth of Formula 1 teams has surged, with each now valued at over £1 billion. This statement reflects the sport's robust economic health and growth trajectory, especially after Liberty Media's acquisition.

Key Takeaways:

• Under Liberty Media's management, all F1 teams have seen their value escalate to more than £1 billion, as per McLaren's CEO, Zak Brown.
• The increased financial allure of F1 teams is evidenced by recent investments in Alpine and Aston Martin, signalling a thriving economic environment.
• Liberty Media's introduction of a franchise-like model, equitable financial distributions, and cost-cap measures have significantly bolstered F1's economic stability, making team ownership highly desirable.

The transformation in the financial stature of Formula 1 teams is a testament to the strategic initiatives undertaken by Liberty Media since its acquisition in 2017. By introducing a franchise-like model, akin to those found in major American sports leagues, and ensuring a fair distribution of prize money and broadcast profits, Formula 1 has entered a new era of economic stability and growth.

During a Bloomberg event in Jeddah, Zak Brown highlighted the stark transformation within the sport, stating:

"Half the grid is profitable. They weren’t five years ago." 

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Brown's assertion of a £1 billion-plus valuation for each of the Formula 1 teams is further supported by recent high-profile investments. Notably, a group involving celebrities Ryan Reynolds and Rob McElhenney, alongside sports icons Anthony Joshua, Patrick Mahomes, and Travis Kelce, acquired a 24% stake in Alpine for €200 million, implicitly valuing the team at around €800m. In a similar vein, Aston Martin's valuation was catapulted to £1 billion following a minority stake sale to Arctos Partners.

The allure of joining the profitable ranks of Formula 1 has not gone unnoticed, with various entities expressing interest in becoming part of the sport, including Andretti. However, the prospect of expanding the grid is met with caution. Reflecting on the challenges of integrating a new team, Brown emphasised the importance of safeguarding the sport's value:

“What Liberty is wanting to do is protect the value of the ten teams that exist.

“We’re now in a position where pre-Liberty you had teams falling away.

“Now [in the] post-Liberty era, there are teams lining up that want to get into the sport.

“So I think Liberty is just seeing how, when and if they want teams to enter.”

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