Fox has acquired a one-third interest in IndyCar's parent company Penske Entertainment, marking a unique deal that makes the racing series the first in the United States to be partially owned by its broadcasting network. According to a report in the Wall Street Journal — which shares a parent company, NewsCorp, with Fox — the deal valued Fox's investment between $125 and $135 million. The agreement also includes an extension of Fox's television rights deal with IndyCar.
The acquisition comes four months into the network's first season of broadcasting the modern iteration of IndyCar. Fox acquired the rights to the series from NBC during bidding last year, then spent the off-season promoting its new rights deal with a series of driver-focused ads that even aired during the Super Bowl. Fox also moved all race broadcasts to network television rather than the previous mix of network, cable, and streaming. This has resulted in a modest but noticeable increase in viewership, including a major 41% spike in television audience for the marquee Indianapolis 500.
As a broadcast partner, Fox was already a major stakeholder in IndyCar's success. Now that it actually owns a portion of the series, its interests have grown substantially. That's the upside for IndyCar, which now has a co-owner with a vested interest in making sure that the series is one of the biggest racing properties in the country. The upside for Fox is that its share in the series was relatively affordable in the world of sports acquisitions, meaning that an investment in promoting the series could greatly increase the value of the one-third stake.
That bet is similar to the one Liberty Media made when acquiring Formula 1. After F1's new ownership group made major changes in how the series was promoted, it saw global growth in both audience and sponsor interest. If Fox can pull off the same thing with IndyCar, its acquisition could pay dividends quickly.
You Might Also Like
Comments