06/07/03

Octagon Motor Sports will be offered for sale, it has been confirmed by parent company, Interpublic. The American advertising and marketing group, which had debts of more than $2billion at the end of 2002, has brought in Corporate Finance advisors to carry out the sale, reports today’s Sunday Telegraph (6 July).

The article states that Octagon is valued at just £70million, considerably less than the £120million it paid for Brands Hatch Leisure in 1999. Octagon consists of 4 UK circuits – Brands Hatch, Snetterton, Oulton Park and Cadwell Park, and whilst they were bought by Interpublic as a package, suggestions are that they could be sold off separately. Brands Hatch alone has a likely price tag of £35million.

The sale is to be conducted by management firm Jones Lang LaSalle, who state in a press release:

“The sale includes an aggregate of 1,050 acres of freehold land with potential long-term leisure and residential development angles. However, the principle value of the business is generated by the underlying operations of hosting motor racing events, track testing, corporate/retail entertainment days and motor sport activities.”

It is possible that the circuits could be sold to a non-motorsport organization, with the threat of property development on the land being very real. Also in question are the rights for the British Grand Prix at Silverstone – for which Interpublic currently holds the lease.

The Brands Hatch circuit held its biggest 4-wheeled meeting since 1986 earlier this year, when the American Champ Car series combined with the BTCC to draw nearly 60,000 spectators to the Kent circuit. It also plays host to the Superbike World Championship.

Jones Lang LaSalle says that it has already received over 70 enquiries, with initial bids to be taken towards the end of July. It hopes to have the deal concluded by September.