Saturday, 18 January 2014 00:00
Reuters: Formula One boss Bernie Ecclestone has been ordered to stand trial on bribery charges in Munich over the sale of a stake in the motor racing business, forcing him to loosen his long grip on the sport.
Ecclestone, 83, was charged last July with bribing former German banker Gerhard Gribkowsky to smooth the sale of a stake in Formula One to private equity firm CVC eight years ago.
“Under current planning, the main trial should start in late April,” the Munich court said in a statement on Thursday. If convicted, Ecclestone could be sentenced to up to 10 years in jail.
Formula One said that Ecclestone would remain in day-to-day charge of running the business, which has an annual turnover of around $1.5 billion (916.5 million pounds), but he had stepped down as a director pending the outcome of the trial.
Ecclestone will also face tighter supervision from a Formula One board that includes well known businessmen including Nestle chairman Peter Brabeck and WPP chief executive Martin Sorrell.
“The approval and signing of significant contracts and other material business arrangements shall now be the responsibility of the Chairman, Peter Brabeck, and Deputy Chairman, Donald Mackenzie,” Formula One said in a statement.
Ecclestone has denied wrongdoing and said he will fight to clear his name.
“Mr. Ecclestone has reassured the Board that he is innocent of the charges and intends to vigorously defend the case,” the Formula One statement added.
CVC co-founder Mackenzie has previously said Ecclestone would be fired if he were found guilty of wrongdoing. CVC remains the largest shareholder in Formula One with a stake of around 35 percent.
Ecclestone already faces a $100 million damages claim in a civil lawsuit at the London High Court over claims he steered the sale to CVC to ensure he stayed on as chief executive.
The uncertainty over Ecclestone’s future makes it hard to revisit stalled efforts to launch an initial public offering of a sport that attracts hundreds of millions of television viewers to its series of grand prix races held around the globe.
CVC paid about $830 million for BayernLB’s 47 percent stake in Formula One, after the business had fallen into the hands of a group of banks following the collapse of German media company and controlling shareholder Kirch.
A Munich court in 2012 jailed Gribkowsky, former chief risk officer at BayernLB, for tax evasion and bribery for taking a $44 million payment from Ecclestone and his family trust after the sale.
Ecclestone has repeatedly said the payment had nothing to do with the CVC deal and that he was the victim of coercion by Gribkowksy who was threatening to make false claims about his tax status.
That London decision should come in January or February.