US GP in Austin Discussion and Speculation...

I am sure Bernie will take a government guarantee with payment up front as solid enough not to require pre-payment.

This is exactly what he had with Texas... until Epstein (and Tavo to a lesser extent) screwed it all up. Now the gov't won't pre-pay, so Bernie has this immensely valuable product that he is expected to provide up front, then wait to get paid until later. He's not gonna do that. He wants a LOC which is going to guarantee him payments based on his deliverables.

LOC's aren't always based on sufficient cash reserves being held in a type of escrow... I imagine Indy could get a LOC for $25MM for 10 years without handing over $250MM to the bank. But Indy is an established business and the bank will be able to look at their finances and history and know how likely they are to be unable to fill the contract, which is less likely than COTA being unable to fulfill the contract. That COTA isn't financially stable isn't Bernie's fault and why would he take on that risk? He's 81 years old and has earned billions. He has more people wanting his product than he has product to sell. He has governments throwing money at him like it's rice at a wedding. He already has a race in the USA with a lot more gov't support, and no (apparent) contract issues.

Why in the world would he compromise on how much risk he takes on with COTA?

There is still a glimmer of hope. Bernie is a tough negotiator. If Epstein realizes he is looking at a loss of tens of millions or more, years of lawsuits (many probably directed at him from his investors), and a seriously compromised reputation, he may come to the conclusion that it is easier to pay up to Bernie and not lose everything.

I doubt he will do that, and he may not have the $$ to even do that... but that's his only choice.

I'd dearly love to be a fly on the wall of the FOM/COTA offices right now. I bet Epstein is still in a rage and threatening scorched earth. As they say, a man's gotta know when he's been beaten

 

Does anyone know the exact dollar that would secure this deal or take it to the next step?

 

Whatever it is, it seems to be more than they have available!

Seriously, my *guess* is Bernie wants a LOC to cover the sanctioning fee (for a single year) paid pretty much right now - Certainly before the WMSC meets to finalize the calendar. The story was that Tavo could have had it for $25MM. Now he's been sidestepped that may have increased (no "buddy discount") but AFAIK that's speculation.

Then there's the COTA money needed to actually build the sucker, but that's a different tale.

Cheers,
Ian

 

Since Indy was paying 25MM, fair to assume that the figure is higher now.

 

http://espn.go.com/racing/f1/story/_/id/7246421/us-grand-prix-week-sign-contract-save-race-bernie-ecclestone-says

 

Lets all kick in ten bucks each, that will do it.....

 

One thing I don't understand is all this media drama, it seems that now Bernie is saying Tavio screwed his deal up a long time ago.

 

#1; It's Tavo!..... Sorry, that's been bugging me in your posts for ages

Anyway, I don't think that's what he's saying at all; Seems to me he gave him the contract (likely at something of a discount) and he's been unable to raise the $ defined therein - How exactly he was going to get that kind of money is beyond me and was probably always beyond Bernie too, but as a long time friend he wished him luck and let him run with it.

Then it seems Tavo & COTA got into a pissing contest and here we are - A bunch of dirt got moved then the wheels fell off. As SRT Mike says, you need to be very, very careful when dealing with the pygmy......

Cheers,
Ian

 

http://www.austinchronicle.com/blogs/sports/2011-11-17/austin-grand-prix-for-2013/

Sounds to me like the spokesman for COTA just said they can't be ready in 2012.

 

Alternatively -- They were going to make 2012, and certainly that makes 2013 a no-brainer.

It pisses me off that this all came apart because Tavo tried to change the Deal.

 

Did tavo try to change the deal, or did COTA not want to pay tavo his share? Hard to imagine it wasn't defined in contract as a $amount / % stake... I'm having a tough time figuring out a plausible sequence of events for the Tavo / COTA divorce where it ends in both losing so badly.

 

another article with the 2013 date:

http://www.statesman.com/blogs/content/shared-gen/blogs/austin/racing/entries/2011/11/17/circuit_president_2013_allows.html

 

So what gives way to hold two American (US) GPs in 2013? Calendar already full.

Is that "the Fat Lady" I hear...........

Shame we didn't get some videos about this a la USF1.

 

What exactly did Tavo try to change?

 

Post #8 of this thread was very clairvoiyent

 

You made post #1 sad.

 

I renamed him to match Fabio....

It goes better with the preening ego driven mentality I imagined in him all along...

MONTHS ago when Bernie met BOTH sides in London he conseled an agreement to the mutual benifit of all.

Didn't happen.

Just dump today's concrete order down that gully over there, it doesn't keep long, once you add water!

 

Title fixed

 

I thought you were going for Flavio (Briatore)...

 

This is a fine point so I am just going to put it out there:

IF the promoter and the Track developer had put everything together and had a Public Face "all was well", then the STATE's prepaid $25M would have gone to Bernie, and Tavo would have need NET ZERO into the game, and could be raking in ticket sales right now...

 

Hey man, that Hedgie guy still has a WEEK to come up with the 2012 fee...per Bernie today
I'd bet her's got a 'sell' order in right now on today's market.

Ameriprise always takes three days, to clear mine, so it'll be close.

I wonder how Tamara's tub is coming along......

 

Perhaps it should be...

US GP in Austin: June '12... NO; Nov '12... NO;... 2013???

 

I agree....

BUT the way this has played out I think Tavo for whatever reason tried to SELL his stake.

Maybe to an outsider if he could not get his perceived "value" from COTA as a partner or outright sale.

 

Very plausible that he did,... but COTA would have said yes (here's your $$$) or no (we'll keep the contract as is thank you).

Possible that Tavo violated some contractual obligation, and COTA told him to get lost, without paying him anything and then he refused to sign over the contract... but that would be in court, not in the press.

Bottom line,... there has to be money problems (lack of) behind the scenes. Now that Tavo/COTA have managed to jeopardize the $25M / $250M subsidy, the project is on worse financial footing.

And consider this,... NJ taxpayers are not subsidizing their race in 2013. How on earth are texas pols going to sell the need to subsidize the race in texas to the tune of $25M to the voters the same year? IMO, the subsidy is not a sure thing in 2013...

 

Thanks!