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CPPIB takes stake in motorcycle grand prix organizer

Canada Pension Plan Investment Board (CPPIB) said it has agreed to buy a large stake in motorcycle grand prix organizer Dorna from private equity firm Bridgepoint.

The Canadian pensions group said on Friday it would take a 39-percent stake in the business that has the rights to organize MotoGP events and the FIM World Superbikes Championship for an undisclosed sum.

However, a source familiar with the deal said CPPIB was buying the stake for about 400 million euros ($518 million US).

The stake sale is another example of how large pension funds are buying into businesses alongside private equity houses, as they look for better returns from growing companies with good long-term prospects.

The $100-billion Texas Teachers' pension fund last week agreed a deal to buy a 3-percent stake in the Formula 1 motor racing business, investing alongside private equity house CVC.

Madrid-based Dorna organizes 18 races in 13 countries and generates revenues from television broadcast contracts, sponsorship and advertising as well as corporate hospitality and related services.

Bridgepoint bought Dorna in 2006, in a deal that valued the company at about 500 million euros. The company recently acquired the FIM World Superbikes Championship for an undisclosed sum.

The sale of a stake to CPPIB means Dorna has earned Bridgepoint and its investors more than 3 times the money they have put into the company, the source said.

The transaction is expected to close in the final quarter of 2012.

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