Team owners make bid to buy IndyCar series – Maybe it’s time to sell it
Tony George destroyed the sport of IndyCar back in 2005 when he announced the creation of the IRL. The split drove a stake through its heart and the sport has bled to death ever since. With TV ratings now below infomercial levels its time for someone to buy the series who has the resources, sponsor connections and business prowess to make it a success again. There are only two entities in this world capable of doing that – the France family (NASCAR) and Bernie Ecclestone – and Ecclestone isn't interested.
10/24/12 It’s 1:30 on what should be a quiet Tuesday afternoon in Indianapolis. In the past two hours, three people considered well placed and informed have offered different perspectives on IndyCar’s direction.
- One said Tony George will be given control of the sanctioning body by the end of the week.
- Another said Randy Bernard is out as IndyCar’s CEO.
- A third said IndyCar’s ownership and leadership is not changing at all. Indy Star
10/22/12 In this AP article, Jenna Fryer says, Randy Bernard has certainly made mistakes in his three years on the job, and he's a promoter who had no experience in racing who has been miscast as the head of a motorsports series. But he has certainly tried to clean up the mess he inherited from Tony George all while keeping a close eye on the knives being aimed squarely at his back.
And that's why the family should entertain selling the series.
The board has to be willing to publicly support the CEO—something it hasn't done once in the past year with Bernard left publicly twisting in the wind, first in the fallout from Dan Wheldon's fatal accident, and then from the attempted mutiny from the team owners. It has to also empower the CEO to crack down on disruptive team owners because actions detrimental to IndyCar are harming the struggling teams who need to find sponsorship dollars.
Yes, the Hulman-George family has spent a tremendous amount of money and done more than its part to prop up open-wheel racing in America. But IndyCar needs some serious help to grow, and cash can do it: from leasing ovals to beefing up the marketing strategy or even buying the series out of its current television contract.
It's unfair to expect the family to continue to fund those endeavors and not grow weary of never turning a profit. But there's never going to be a profit if the series is a constant amateur hour of owners running amok.
It's time to take charge of the series and make a commitment to making IndyCar as good off the track as it is on the track. Or let someone else have a chance before it's too late.
And so we repeat what we said below, let's not forget AR1.com's editorial – Is NASCAR the only viable savior for IndyCar? Do they have the money, connections and influence to make IndyCar a success? With the right contract in place to ensure the France Family keeps the sport alive and well, you bet they do.
10/19/12 A reader writes, Dear AR1.com, How can anybody who claims to be an Indy fan go along with anything Tony George is involved in. He almost killed the 500 and now some want him back to finish the job. His fans or backers should go over to NASCAR and watch their contrived racing. Bogus poles, bogus yellow lights, and bogus GWC endings, I'm now 83 and glad to have seen the good old days of auto racing. Going to Gilmore, the Rose Bowl, Culver City, Ascot, and Ontario were great outings. Even the jalopy races were fun to watch. Don. B
10/19/12 This speed.com article speculates on what is likely Tony George's motives for making a bid to buy the IndyCar series. George has been anti-Bernard since sister Josie George brought the former Pro Bull Riding savior into the family to replace her brother. TG was miffed that Terry Angstadt wasn’t embraced and that Brian Barnhart has been reduced to a buck private. He’s upset that Bernard is considering replacing Firestone. He’s unhappy with the number of oval tracks on the schedule and the price of car parts.
He’s undoubtedly pissed off that the role he was born into is now managed by his college roomie (Belskus) and a cowboy who had never seen a race before 2010.
And he can’t be real thrilled that Bernard is pretty popular with Indy car fans.
But forget all that and consider the facts, as we know them.
Because of supporting IRL teams with free cars and engines, paying purses, numerous marketing deals, a fleet of airplanes, Gene Simmons, helicopters, Vision Racing, tearing up IMS to accommodate Formula One, a mammoth in-house payroll, and repairing The Split he caused, George spent hundreds of millions of dollars from 1996-2009.
So it basically comes down to what the 11-member board of directors of Hulman & Company decide is best for the future of IndyCar.
If it was up to the old board (which consisted of Mari Hulman George, Kathi George Confori, Nancy George, Josie and Tony), it looks like it would favor a Tony takeover. Best I can tell Josie and Kathi remain in Bernard’s corner while Nancy now feels compassion for her brother and supports his movement. Mari Hulman-George hated pulling the plug on her only son and wants him to be happy so it would be 3-2.
Belskus appears to be a Randy supporter but it’s tough to tell sometimes.
The rest of the board is comprised of respected businessmen Jim Morris, Mike Miles, John Ackerman, Andre Lacy, Michael Smith — who have no ties to the family but were brought it to help with efficiency, accountability and bottom lines.
It’s hard to imagine that quartet looking at the numbers and what’s transpired in the last three years compared to the previous regime and make a change in leadership.
Of course it was also hard to fathom how anybody could screw up the month of May.
I get that it’s always been a family business and George feels like it’s his right to be pushing the buttons. But he had 20 years in the Big Chair and his vision didn’t work so well. Giving the reigns back to him, or his consortium, would be bad business.
It would also be a public relations disaster. If the board does decide to do the unthinkable they need to know the repercussions from the majority of the dwindling fan base would be decidedly loud and anti-TG. It took many of them a long time to try to forgive and forget but this time they’ll simply forget — to give a damn.
But let's not forget AR1.com's editorial – Is NASCAR the only viable savior for IndyCar? With the right contract in place to ensure the France Family keeps the sport alive and well, you bet it is.
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| It is CART all over again, which can be a good thing. It was a good thing until Tony George created the IRL and split the sport. So this could work. |
10/13/12 If Tony George has put together a group of investors and made a formal offer to purchase the IndyCar Series, as reported Friday in the Sports Business Journal, it doesn't include Roger Penske and Chip Ganassi.
SBJ’s story said George hired a law firm to approach car owners, among them the two most successful in open wheel racing.
But both denied it to SPEED.com.
“That story is wrong, I’m not part of any group making an offer," said Penske via an email. “I am aware of discussions but I’m not involved."
Ganassi said he heard about it last June when SPEED.com first broke the story about George, John Barnes and Kevin Kalkhoven trying to assemble the owners to buy IndyCar from Hulman & Company.
“Somebody asked me two months ago if I would be interested in doing it and said, ‘Sure, I’d take a look at it,’" replied Ganassi on Friday afternoon. “But I haven’t heard another word since and somebody is out there making a lot of **** up." speed.com
10/12/12 A group led by Tony George has expressed interest in purchasing the IndyCar Series he founded more than a decade ago, but that interest is not being reciprocated.
“It’s not for sale," a Hulman & Co. board member told The Star on Friday. “It’s not for sale because it’s too deeply intertwined with the fortunes of the Indianapolis 500."
The board member declined to be identified due to company policy requiring the group to speak as one.
The “not for sale" message was the same Friday as it’s been since word of George’s interest in regaining control of the series surfaced last week.
George recently submitted what IMS CEO Jeff Belskus described as “an expression of interest." He said it wasn’t a proposal, but he offered no additional details.
“IndyCar is not for sale," Belskus said.
The document from George’s group was prepared by Faegre Baker Daniels, a top Indianapolis law firm. It did not name other members of the group, but IndyCar team owners Roger Penske and Michael Andretti, among others, have told The Star they want no part of owning the series. Kevin Kalkhoven and Chip Ganassi are believed to be part of George’s group.
The board member said the document hasn’t been considered at any official level and won’t be.
George also is a member of the Hulman & Co. board. The board’s last meeting was Sept. 20.
A George confidante said the former IndyCar CEO has been floating ideas about the series to IndyCar team owners and others associated with the sport, including marketing ace Zak Brown of Zionsville-based Just Marketing International, for at least the past three weeks. George could not be reached for comment.
The Sports Business Journal reported Friday that George’s proposal included “a seven-figure cash" offer. George also would assume future losses for the series in exchange for management control.
A source said George has inquired about potential candidates to become the next chief executive officer of the series should he acquire it. George has not agreed with many of the initiatives instituted by Randy Bernard, the man chosen to replace him in 2010. Indy Star
10/12/12 A Tony George-led group completed its due diligence and within the last week submitted a financial offer to Hulman & Co. for the IndyCar Series, according to sources familiar with the matter. The offer to the privately-held company, which also owns Indianapolis Motor Speedway, included a seven-figure cash proposal to take over management and assume future losses for the series, which reportedly lost $7M this year.
George did not return calls seeking comment. A Hulman & Co. spokesman said, "We're not going to confirm or deny what we get because we get unsolicited proposals all the time. The series is not for sale." George has hired the Midwest-based law firm Faegre Baker Daniels and approached IndyCar team owners, including Chip Ganassi, Roger Penske, Michael Andretti and Kevin Kalkhoven, as well as motorsports marketer Zak Brown about investing in the acquisition of the series.
The takeover proposal comes four years after the Indy Racing League and Champ Car World Series merged, ending 12 years of a split between the two U.S. open-wheel racing series. George brokered that deal in '08 and paid $40M to create a unified IndyCar Series. He resigned a year later after the series fell under financial pressure in the wake of the recession. Randy Bernard, the former head of the PBR, replaced him in '10. SportsBusiness Journal October 12, 2012
10/03/12 A reader writes, Dear AutoRacing1.com, I just received my printed copy of this weeks Sports Business Journal and there on the front page is their article about the takeover. It goes into much detail. Name Withheld by request
10/01/12 In a statement, the Indianapolis Motor Speedway has refuted a story published today by the Sports Business Journal claiming that former IMS and IndyCar chief Tony George and a group of team owners are developing a proposal to purchase IndyCar.
The statement, attributed to Jeff Belskus, president and CEO of Hulman & Company and the Indianapolis Motor Speedway – which serve as the parent companies of IndyCar – reads as follows:
“The IZOD IndyCar Series is not for sale, and representatives from Hulman & Company and the Indianapolis Motor Speedway Corporation have not received or considered any offers to purchase the series. Further, executive management from both Hulman & Company and IMSC maintain continuous and open dialogue with INDYCAR team owners about numerous issues related to the IZOD IndyCar Series, and no INDYCAR team owner formally or informally approached either organization about purchasing the IZOD IndyCar Series.
“Both Hulman & Company and IMSC remain committed to working with the IZOD IndyCar Series and its partners as they prepare for the 2013 season and beyond. The racing in 2012 showcased great competition on track and added to the foundation for growing the series. The just-announced 2013 schedule includes several new twists that could make the racing even more exciting. The combination of the return of nearly all the 2012 venues, including all the ovals, the addition of new tracks and the revival of the Triple Crown award make this one of the most exciting schedules in recent memory."
10/01/12 The board of Hulman & Co., owners of the IndyCar Series, is weighing an acquisition proposal for the open-wheel-racing operation, according to people familiar with the matter. Former IndyCar Series CEO Tony George has put together an investor group that includes some of the sport’s top team owners — Chip Ganassi, Roger Penske, Michael Andretti and Kevin Kalkhoven — as well as motorsports marketer Zak Brown that recently proposed the board sell them the IndyCar Series. The group has hired the Midwest-based law firm Faegre Baker Daniels and begun a financial due diligence evaluation of the series.
It’s unclear what the George-led group offered the board, but sources said that the group would take over management of IndyCar, which operated at a loss this year, and assume any debt on its books.
Hulman & Co. would retain its majority ownership of Indianapolis Motor Speedway and continue to run IndyCar’s Indy 500 and NASCAR’s Brickyard 400 races. It also could opt to take a minority stake in the IndyCar Series during the negotiations.
George declined to confirm or deny that he had engaged Faegre Baker Daniels or put together a group of investors. He described the “premise" as “inaccurate."
Ganassi, Penske, Andretti, Kalkhoven and Brown did not return calls seeking comment. Hulman & Co. CEO Jeff Belskus was out of the country last week and could not be reached for comment. An IMS spokesman said the board has a policy of not commenting on board meetings.
It is the second time in less than four years that George, who ran the IndyCar Series when it was called Indy Racing League and is a member of the Hulman & Co. board, has put together a group to take over the series. The first time reportedly was in 2010.
The board was told that Brown, who founded the Indianapolis-based motorsports agency Just Marketing International, would lead the series’ management team if George’s group is successful. It’s unclear how that would work. Brown is still the CEO of JMI, which has built an international operation around Formula One in recent years and continues to work domestically with sponsors of NASCAR and IndyCar. The agency’s investors include Spire Capital and WPP.
If Brown didn’t take the job, sources said the Hulman board discussed the possibility that the group could hire John Lopes, Andretti Autosport’s executive vice president and chief operating officer. Another logical candidate would be Joie Chitwood III, Daytona International Speedway’s president who was the chief operating officer at Indianapolis Motor Speedway for seven years at a time when George was the speedway’s CEO.
Sources familiar with the Hulman & Co. board said the final decision on selling the IndyCar Series will be made by Mari Hulman George, 77, the board’s chairwoman. She controls the majority of the voting interest in the company. The 11-member board also includes her four children — Nancy L. George, M. Josephine George, Katherine M. George-Conforti and Tony George — and six local businessmen, who serve in an advisory role. More at Sports Business Daily