Liberty Media’s Potential Acquisition of MotoGP: Sorting Fact from Rumor”

Rumors have circulated for a while about the possibility of Liberty Media acquiring MotoGP. Dorna Sports currently holds the commercial rights for MotoGP, and CEO Carmelo Ezpeleta addressed these rumors in an interview with the Italian Repubblica. Ezpeleta confirmed the existence of rumors but expressed uncertainty about their origin, noting that he often receives inquiries, mainly from banks acting as intermediaries rather than potential buyers.

Ezpeleta stated, “I can say that nothing has happened for now. Anything can always happen, at any time, but for now it hasn’t. What is certain, however, is that our product is valued.” As a shareholder in Dorna Sports, Ezpeleta would naturally aim for the highest possible price if a sale were to occur. In 2023, Liberty Media was frequently mentioned as a potential buyer for Dorna Sports and MotoGP.

Given Liberty Media’s financial success in Formula 1, the idea of expanding into the premier class of motorcycle racing seems plausible. However, there is no concrete evidence of ongoing discussions or negotiations. The rumors have quieted down in recent months, leaving speculation about the potential acquisition in a state of uncertainty. Typically, in such negotiations, there are leaks or hints from involved parties, but at present, there is no indication of any talks happening between Dorna Sports and Liberty Media. As a result, the prospect of seeing a MotoGP race during a Formula 1 weekend in the near future remains uncertain.

Could Formula 1 and MotoGP share the stage simultaneously?

The notion of Formula 1 and MotoGP concurrently sharing the stage was initially broached by Bobby Epstein, the owner of the COTA circuit. However, Epstein dismissed the idea when revisited in October 2023, citing the challenges posed by differing safety measures required for each class. The notable success of Formula 1 under Liberty Media’s ownership has sparked interest in applying a similar strategy to MotoGP, seen as a potential growth opportunity.

Despite MotoGP experiencing an upswing in ratings, spectator numbers, and revenue in 2023 compared to the previous year, it still grapples with a substantial debt. Investors may find it appealing to sell their shares if a significant offer, like the rumored €2 billion, materializes from a party such as Liberty Media. This amount, while substantial, raises questions about the feasibility of a quick return on investment for a new owner.

Comparatively, Liberty Media’s takeover of Formula 1 saw a considerable increase in revenue, from $1.8 billion to $2.6 billion in 2022. The success in transforming F1 financially has made Liberty Media’s investment in the motorsport giant worthwhile. However, the financial dynamics of MotoGP currently seem less enticing to Liberty Media. The acquisition of QuintEvents, a company that operated successfully in both the Formula 1 and MotoGP realms, is a noteworthy indicator of Liberty Media’s belief in opportunities in both motorsport categories. The purchase of QuintEvents, responsible for F1 Experiences series, exemplifies Liberty Media’s strategic interest beyond Formula 1, extending into the MotoGP domain.

‘Growing popularity of MotoGP’

However, this aspect remains too small to gauge whether Liberty Media intends to proceed with acquiring Dorna. In Formula 1, Liberty Media successfully elevated the sport’s profile in the United States through the popular Netflix series Drive to Survive.

While MotoGP has also released some series on various platforms, they have not achieved the same level of success as Formula 1. Consequently, making MotoGP financially lucrative in countries like America poses a significant challenge. The key question revolves around how Liberty Media plans to effectively revitalize MotoGP.

Historically, MotoGP’s popularity was significantly shaped by Valentino Rossi over the past two decades. However, since Rossi’s departure from the sport, no rider has ascended to the same heights of global recognition. Even an eight-time world champion like Marc Marquez does not command the same level of interest as Rossi once did.

For any potential investor eyeing the acquisition of Dorna, relying on the success of individual riders in the current field, who have yet to attain worldwide renown, is not a feasible strategy. A strategic and innovative approach is essential, considering MotoGP can no longer piggyback on the success of one or more prominent names.

MotoGP reported a 20% increase in attendance at Grand Prix events in 2023, particularly evident on Saturdays, attributed to the introduction of fixed sprint races. However, television viewership figures indicate that the overall growth might not be as substantial as it seems. In Spain, for instance, DAZN recorded approximately 209,000 viewers for the Catalunya GP, while the open channel drew over a million viewers for the same race. This highlights the challenge of converting high interest into subscription numbers.

Even in Italy, a prominent motorsports country, the viewership figures during Francesco Bagnaia’s championship-winning race in 2023 were only moderately impressive, with an average of 826,000 viewers. By comparison, the same day’s Formula 1 race in Abu Dhabi attracted 777,000 viewers on Sky Italia. Notably, during Valentino Rossi’s farewell race at the 2021 Valencia GP, an average of 860,000 Italians tuned in, showcasing higher viewership during a significant moment.

These observations underscore the fact that, for various reasons, MotoGP is watched less than in previous years in the most prominent motorsports countries. While there was an increase in viewership in 2023, the sustainability of this growth into 2024 remains uncertain, especially considering the absence of sprint races in MotoGP.

Could Marc Marquez be a pivotal factor for potential acquiring parties?

Considering the viewer numbers are not exceptionally high in Spain and Italy, the looming question is whether platforms like DAZN and Sky Italia will continue to invest significantly in the rights in the future. This factor holds significant importance as it constitutes a crucial revenue stream for Dorna or any potential buyer. It’s imperative for this revenue stream to remain stable.

At the onset of the new year, numerous rumors emerged about a potential takeover, notably fueled by statements from Carmelo Ezpeleta. While these statements led to speculations that Dorna is on the brink of selling the company, a careful reading of the Spaniard’s words reveals that he doesn’t divulge any concrete details. He acknowledges the existence of rumors about a potential sale but doesn’t confirm ongoing discussions with any party. As a result, clarity about Dorna’s potential suitors will only emerge when there are tangible indications.

Whether Liberty Media will be the contender is yet to be determined. The challenges outlined suggest that replicating the commercial success of Formula 1 under Liberty Media’s leadership may pose difficulties for MotoGP. Dorna may be banking on Marc Marquez’s participation in this year’s world title challenge on a customer Ducati to boost global interest. If the eight-time world champion manages this feat, it could potentially enhance interest worldwide and provide that extra push for a prospective investor to acquire Dorna.