Nov. 6 (Bloomberg) -- Bernie Ecclestone told a U.K. court that payments he made to a banker before the sale of a controlling stake in Formula One were the result his being “shaken down” and had nothing to do with his role as chief executive officer of the racing series.
Ecclestone was asked whether he denied making the payments to newspapers and the Formula One board in 2011 after Gerhard Gribkowsky was arrested on suspicion of receiving bribes. “This issue was nothing to do with anyone but Mr. Gribkowsky and myself,” he said today. “I was being shaken down.”
German media company Constantin Medien AG is suing Ecclestone in London over allegations he bribed Gribkowsky to ensure the 47 percent stake was sold to his favored bidder, CVC Capital Partners Ltd., in 2005 for $814 million. Constantin claims it lost as much as $171 million because the deal undervalued the racing series.
Ecclestone is facing criminal charges in Germany and an investigation by Swiss prosecutors into the deal. Gribkowsky was convicted in Munich of receiving a bribe last year and is serving 8 ½ years in prison.
Ecclestone had told a newspaper in 2011 the bribery allegations were “absolute nonsense,” said Philip Marshall, a lawyer for Constantin.
The 83-year-old billionaire today admitted making payments and denied being dishonest when asked about it afterward.
“I was more concerned with this whole matter being kept out of the public” because of Gribkowsky’s threats to tell British tax authorities about a family trust, Ecclestone said. He said he told the truth to journalists, Formula One executives and investigators from CVC.
Ecclestone is worth at least $2.8 billion, according to Bloomberg Billionaires Index. This excludes the value of Bambino Holdings Ltd., the multi-billion dollar trust that Ecclestone said Gribkowsky threatened to tell tax officials about and that is held for his ex-wife and children.
The delays caused by the German and U.K. court proceedings have slowed Formula One’s progress toward a planned share sale. The racing circuit suspended plans for an initial public offering in June of last year, citing market conditions, and hasn’t resurrected the plans amid Ecclestone’s legal wrangles.
German prosecutors are waiting for a court to rule on whether they have enough evidence to take Ecclestone to trial on the bribery charges.
Ecclestone has repeatedly said the payments were made to Gribkowsky following threats that he would inform U.K. tax authorities about the family trust controlled by his then wife.
Ecclestone told the court that it wasn’t the first time he had been blackmailed and he didn’t normally go to the police. “I had made up my mind I needed to keep him quiet,” he said, referring to Gribkowsky.
The case is Constantin Medien AG v. Bernard Ecclestone, case no. 11-02586, High Court of Justice, Chancery Division.
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