8-KMaterial AgreementsSecurities & ListingRegulation FD+1

Liberty Media Corp 8-K Report, Material Agreement (Apr 1, 2024)

Filed April 1, 2024For Securities:FWONKFWONAFWONB

Summary

Liberty Media Corporation announced a significant definitive agreement to acquire approximately 86% of Dorna Sports, S.L. for an aggregate equity value of approximately €3.502 billion. The transaction will be funded through a combination of cash (€2.282 billion) and shares of Liberty Media's Series C Liberty Formula One common stock (FWONK), valued at approximately €735 million. Approximately 14% of Dorna will remain with existing management sellers, with specific buyback provisions and liquidity rights outlined in a separate Shareholders’ Agreement. The deal is subject to regulatory and foreign investment approvals, with a longstop date of December 31, 2024, extendable to March 31, 2025, under certain conditions including a potential payment of €126 million.

Key Highlights

  • 1Liberty Media to acquire ~86% of Dorna Sports for ~€3.502 billion.
  • 2Transaction consideration includes ~€2.282 billion in cash and ~€735 million in FWONK shares.
  • 3Approximately 14% of Dorna will be retained by management sellers ('Rollover Management Holders').
  • 4A Shareholders' Agreement details governance, liquidity rights for Rollover Management Holders, and transfer obligations.
  • 5The acquisition is contingent on regulatory and foreign investment approvals.
  • 6A bridge loan facility of up to $2 billion from Goldman Sachs Bank USA is in place to finance the cash portion.
  • 7The Purchase Agreement includes termination clauses, potential extension fees, and registration rights for the issued FWONK shares.

Frequently Asked Questions

This 8-K filing announces Liberty Media Corporation's entry into a material definitive agreement to acquire approximately 86% of Dorna Sports, S.L. It outlines the key terms of the transaction, including the purchase price, form of consideration, closing conditions, and the terms of a related Shareholders' Agreement.

The acquisition will be financed through a combination of approximately €2.282 billion in cash and approximately €735 million worth of Liberty Media's Series C Liberty Formula One common stock (FWONK). Liberty Media has secured a commitment for a $2 billion bridge loan facility from Goldman Sachs Bank USA to cover the cash portion of the transaction.

The closing of the transaction is subject to several conditions, including obtaining required approvals under specified foreign competition laws and approvals from Spanish and Italian foreign investment authorities. There must also be no law or order prohibiting the consummation of the transaction.

Certain Dorna management sellers will retain approximately 14% of Dorna's equity interests (Holdover Shares) valued at approximately €485 million. The Shareholders' Agreement grants these 'Rollover Management Holders' certain liquidity rights, allowing them to sell their shares back to Liberty Media over a period of several years post-closing, and outlines governance for Dorna, with Rollover Management Holders having the right to appoint one director as long as they hold a significant stake.