Formula 1 supremo Bernie Ecclestone has made billions out of the sport, but now faces the greatest test of his life off the racing circuit after his indictment this week over bribery allegations, reports Kyran FitzGerald
IS the long-time emperor of world motor sport about to lose his throne? This week, it emerged that Bernie Ecclestone, the boss of Formula 1, has been indicted by German prosecutors on charges of bribery.
If convicted, the 82-year-old motor sport supremo could be facing into a jail sentence, hardly what the doctor would order for a man of such advanced years.
Even if an unsuspended prison sentence looks unlikely, Ecclestone faces years of uncertainty, barring an out-of-court of settlement which would almost certainly result in enforced retirement. It might be foolish, however, to lose too much sleep over his fate.
The 5ft 3in tall Ecclestone is nothing if not a survivor.
The current legal impasse has come about courtesy of a German banker, Gerhard Gribkowsky, who is himself serving a jail sentence for tax evasion and may, in consequence, be bearing a few grudges. It is alleged that Ecclestone paid a large bribe to Mr Gribkowsky to facilitate a takeover of the Formula 1 commercial entity by the venture capital firm, CVC Capital Partners.
The banker was employed by Bayern Landesbank of Bavaria which had ended up with its stake in Formula 1 following the bankruptcy of the empire of German businessman, Leo Kirch, a client. The allegations against Ecclestone have spread shock waves through the world of motor sport, prompting Daimler Benz, parent of Mercedes Benz, to express deep unease while some teams have questioned whether he has a future in the sport.
Ecclestone is faced with a legal war on at least two fronts as a separate court case has been brought against him by another Formula 1 shareholder, Constantin Medien, claiming that his stake was undervalued at the time it was sold.
No one can possibly question the sheer impact Ecclestone has had on the world of motor sport and Formula 1, in particular, since the early 1970s. He has transformed the business from one run largely by gentleman amateurs and confined to Western Europe into a global business with a support base behind only world soccer and the Olympic Games.
Formula 1’s annual income is estimated at $1.5bn (€1.14bn) and Ecclestone has been working on a flotation on the Singapore stock market scheduled for next autumn. Its estimated value was being put at $12bn. The flotation has already been postponed due to uncertainty in the financial markets. Events in Germany look to have kicked this plan into the long grass.
Bernie, however, will not go hungry, and nor will daughters, Tamara and Petra. Ecclestone’s net worth is estimated at close to $4bn — this after ceding around a quarter of his assets to his former wife, Slavica, the girls’ 6ft 2in Croatian-born model mother, in a divorce settlement. Slavica towered over Bernie, but friends say she used her charms to good effect on his behalf in business dealings over two decades.
It is all a far cry from a childhood spent initially in Suffolk, where his father worked as a trawlerman and later on, in south east London.
Ecclestone left school to work in the local gasworks, riding motorbikes in his spare time. As a teenager, he traded in motorbike parts forming the Compton & Ecclestone vehicle dealership with a friend. He acquired his original fortune in this business and also in the property and loan finance sectors.
He raced a number of times at Brands Hatch, retiring after a number of accidents. He managed two drivers, Stuart Lewis Evans and the Austrian, Jochen Rindt, both of whom died in accidents — Rindt was posthumous world champion in Formula 1 in 1970.
In those days, fatalities were common on the circuit. Transformation in safety would only come in the 1990s following the deaths of the Brazilian star, Ayrton Senna and the German, Roland Ratzenberger on the Monza circuit.
In 1971, Ecclestone was brought in as co-owner of the Brabham Formula 1 team, taking it over the following year. The team was part owned by the champion driver, Australian, Jack Brabham. Bernie was now a Formula 1 executive. He took over the team the following year and became increasingly involved in commercial rights negotiations.
It was through the Brabham involvement that Ecclestone linked up with his longtime right hand man, Max Mosley.
Bernie and Max were chalk and cheese. Max was the son of the former Labour minister, later head of the British Union of Fascists, Oswald Mosley and his wife, Diana Mitford, one of the blue-blooded Mitford sisters.
By the 1960s, Mosley was a successful barrister, able to fund a motor racing hobby. In 1970, he established March Engineering, a racing car manufacturer with three racer/engineer friends. It finished third in the 1970 constructor championship. Mosley negotiated on behalf of the team at the Grand prix constructors association. In 1974, they joined forces with Frank Williams, Ken Tyrrell and Colin Chapman to form FOCA, the Formula 1 Constructors Association.
The stage was set for a confrontation with the Continental European run FIA, or Federation International de Sport Automobile, run by a strong willed Frenchman, Jean-Marie Balestre. The battle for control of the finances of motor sport’s elite culminated in a deal reached in 1982 known as the Concorde Agreement after FOCA had successfully staged a championship race in South Africa.
Under the deal, FOCA secured the commercial rights to Formula 1, leaving the FIA in charge of regulation.
Bernie had secured the keys to the kingdom he had entered. By the late 1980s, Sky and satellite TV was on the march and a global economy was emerging.
By 1993, Mosley had toppled Balestre from his perch at the FIA, setting the stage for true dominance for Ecclestone and his right-hand man.
The death of Senna precipitated major changes on Mosley’s watch. The power of the F-1 engines were reduced. Grooved tyres were introduced to reduce corner speeding. Circuits have been redesigned. Improved crash testing of chasses has arrived, all of which is to Mosley’s credit. Ecclestone engaged in a series of deals aimed at vastly increasing his personal wealth, provoking disquiet among the racing teams.
The pair fought a determined rearguard action against a Europe-wide ban on tobacco sponsorship viewed as critical to the industry. This brought Bernie into the court of Tony Blair and into the eye of the political storm shortly after the victory of New Labour in the 1997 British general election.
Ecclestone was filmed strolling into a Downing St party — a sighting that would be endlessly repeated after Ecclestone’s donation, described by Labour fundraisers as a ‘non repayable loan’, came to light. Eventually, the loan/donation was returned. Bernie has turned increasingly towards the emerging economies of Asia and America as a source of business.
In 2009, Bernie lost the services of Mosley. This followed the exposure by the News of the World of Mosley’s nocturnal activities with prostitutes, in what were described as ‘sado masochistic orgies’.
Ecclestone fights on alone, a plucky Brit up against the German Hun, or unscrupulous operator about to be exposed?
Take your pick, and take your seat. It is bound to be every bit as entertaining as a race involving Michael Schumacher, or Eddie Irvine, or an interview with Eddie Jordan.
Getting to know: Bernie Ecclestone
Educated: The university of life.
Career: Second-hand car dealer, London.
1971: Co-owner of Brabham team.
1974: Masterminds launch of FOCA, British Formula 1 manufacturers’ group.
1982: Takes control of commercial side of Formula 1.
Late 1980s: Agrees lucrative broadcasting rights deals for the sport. By 1993: Gains control of regulatory body, FIA.
Family: Married to Ivy Bamford; Slavica Radic; Fabiana Flosi ( 2012- ). Three children
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