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Formula One's in the Driver’s Seat on Interest Costs

Racing company asks lenders to lower rate on $1.33 billion loan.

By Christine Idzelis, Bloomberg | Updated on June 11, 2013

Formula One is relying on its auto-racing dominance in Europe and a welcoming loan market to slash borrowing costs even as its chief executive may be charged with bribery and private-equity owners pull cash from the business.

The racing company is asking lenders to lower rates it agreed to pay eight months ago in exchange for permission to sell $1 billion of junk bonds that financed a dividend to CVC Capital Partners Ltd. and other private-equity owners. Chief Executive Bernie Ecclestone has been under investigation by German prosecutors for a bribery case tied to Bayerische Landesbank’s sale of a stake in the company to CVC.

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