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Last Updated: Monday, 6 December, 2004, 17:35 GMT
Judge slams Ecclestone's F1 power
Bernie Ecclestone
The banks are pledging to act in the interests of F1
A judge has ruled against Bernie Ecclestone in a boardroom dispute which challenged the businessman's control of the firm behind Formula One racing.

Three creditor banks were disputing the make-up of the board of Formula One Holdings (FOH) - the company that runs the Grand Prix circuit.

Outlining his judgment at London's High Court, Mr Justice Andrew Park said the banks' "contentions are correct".

But Mr Ecclestone has reportedly said the verdict means "nothing at all".

Talking to the Reuters news agency, Mr Ecclestone added: "The banks, they want to get out. These people didn't get their shares out of choice, they got them as a security.

"We have no problems with the banks. This is just a problem of them trying to put value on their shares."

Greater influence

The ruling means the banks could now get a larger say in the running of FOH but it is thought unlikely that they will call for Mr Ecclestone to stand down as F1 chief executive.

And one of the banks concerned, Bayerische Landesbank, has already pledged to act only in the interests of the sport.

The bank said it expected to gain "greater influence" from now on but said collaboration with Mr Ecclestone will be sought.

"We will continue to act in the best interests of the sport and its constituents. This includes the best possible co-operation with all shareholders," said Dr Gerhard Gribkowsky, a member of Bayerische Landesbank's management board.

Michael Schumacher
Because of the way the business is set up, the banks would have to launch further legal actions to win control

Bayerische Landesbank, JP Morgan and Lehman Brothers, are creditors to bankrupt German media group Kirch, which had acquired 75% of SLEC, FOH's parent company.

Mr Ecclestone's family trust company Bambino Holdings, which has a majority on the FOH board, started to sell stakes in SLEC in 2000.

It currently owns 25% of the company but still controls FOH through a right to appoint subsidiary directors to the board, the court heard.

The banks, known collectively as Speed Investments, challenged the appointment by Bambino of two directors to FOH in 2002 in a move that appeared to be geared towards gaining a majority on the board.

The judge ruled that Mr Ecclestone had "no defence" to their claim that the appointments were "invalid".

Bambino was refused permission to appeal.

Rival series

Mr Ecclestone is thought to have been working behind the scenes to keep control of F1.

"Bernie was not opposing this case, so you can bet he has an alternative plan up his sleeve that will leave him with all the crucial cards," one veteran F1 insider told the BBC.

Mr Ecclestone, who has amassed a reputed fortune of 2.3bn ($4.2bn) from F1, is also in dispute with car manufacturers.

The car companies have threatened to set up a rival series in 2008 if they are not given a bigger share of F1's revenues and more say in the running of the sport.



SEE ALSO:
Banks await court ruling over F1
23 Nov 04 |  Business
The main men in F1
11 Oct 04 |  Formula One


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