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2013-11-07 12:01

MILLION-DOLLAR SHAKE DOWN: Bernie Ecclestone's F1 empire is at risk following a series of court case battles. Image: AFP

LONDON, England - A multi-million dollar payment to a now jailed German banker was "an insurance policy", said Formula 1's chief executive Bernie Ecclestone who denied it was linked to the sale of a stake in the business to private equity firm CVC.

Ecclestone is defending a R1-billion damages claim by media firm Constantin Medien which has accused him and three other defendants of deliberately undervaluing F1 in the 2005 sale to safeguard his position as CEO.

The legal fall-out from the sale of a controlling stake in the business to CVC is threatening Ecclestone's four-decade hold on the glamorous sport and complicating stalled efforts to float it on the Singapore stock market.

BRIBERY CHARGE

A Munich court in 2012 jailed Gerhard Gribkowsky, former chief risk officer at German bank BayernLB, for tax evasion and bribery for taking a R405-million payment after the 2005 sale.

Ecclestone said he paid Gribkowsky R133-million but said that was because the banker was threatening to make damaging claims about a family trust to British tax authorities that could have cost him many times that amount.

Ecclestone told a hearing in the London High Court: "What I paid him was a very small amount, what I call an insurance policy - quite a cheap insurance policy."

He said there was no link to a deal in which CVC paid BayernLB R87-billion for a 47% stake in F1: "This issue was nothing to do with anybody except Gribkowsky and myself, nobody else."

A German court will decide in 2014 whether Ecclestone should stand trial for bribery linked to the Gribkowsky payment. Ecclestone denies any wrongdoing.


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