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Finance Formula

September 29, 1998|Times Staff, Reuters

The terms "Formula One" and "yield" don't usually go together.

But the owner of auto racing firm Formula One Holdings on Monday revealed plans for a bond issue of up to $2 billion and said it had appointed Wall Street powerhouse Morgan Stanley Dean Witter to lead manage the deal.

A banking executive involved in the deal said it was designed to give the London-based company, owned by Bernie Ecclestone, a controversial figure in British sports, "all the attributes expected of a company going public."

But he declined to reveal for what purpose the proceeds would be used.

The bonds would be backed by future Formula One earnings from the sale of television rights. Formula One Holdings controls the organization, promotion and marketing of the world motor racing championship, as well as exclusive broadcasting rights.

Spokesman Stephen Mullens said his company, which plans to expand its pay-per-view broadcasting, will eventually revive plans to float shares on the London Stock Exchange.

Mullens blamed the cancellation of an initial public stock offering scheduled for the summer of 1997 on financiers' poor understanding of the company.

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