Adderton investigated buying Supercars
Thursday 8th April, 2021 - 6:00am
Boost Mobile owner Peter Adderton says he sounded out Supercars owner Archer Capital regarding an opportunity to buy the category.
Speedcafe.com understands Adderton was part of a consortium investigating a takeover of Supercars in its entirety from the Sydney-based private equity firm.
However, the telecommunications mogul has told Speedcafe.com he has no interest at the moment given the current structure of Supercars.
He believes team owners have too much control of the business, which he said is to the detriment of the organisation.
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“I haven’t gotten any further other than sending some signals out to Archer [Capital],” Adderton told Speedcafe.com.
“There’s a lot of unknowns, as I said, in the series. There would have to be some massive changes.
“Unless you can control and run it and don’t have the issues that they have right now, then I think there’s no point in us buying it. It wouldn’t make any sense.
“I’m too much of a control freak to be able to make decisions and try to do things and try to improve the sport then have to suck up to a bunch of teams. I wouldn’t do it.
“I would love to have a look at [buying] the category on the whole, but the problem you’ve got is you can’t do it with the teams,” he added.
“You’ve got to own it and be able to run it, but you can’t do it with the teams that basically run a bunch of other things.
“For me, that’s the fundamental thing that’s wrong with it. You’ve got to be able to run the business and make decisions that are in the best interests of the sport but not in the best interests of the teams.
“Until you can control it, run it, and own it, then it’s going to be very, very difficult in my opinion for anyone who buys it.”
Archer Capital bought a controlling stake in Supercars from Tony Cochrane’s business Sports Entertainment Limited (SEL) in 2011.
That purchase cost Archer Capital a total of $137 million. At that time, Supercars had an enterprise value of $296 million.
However, in the years since, Supercars has reportedly slumped in value significantly.
According to the Sydney Morning Herald, a quarterly report to investors showed Supercars’ value had fallen to below $35 million just as the coronavirus pandemic hit in March, 2020.
For Adderton, the value of the company is less of a deterrent. Rather, his frustration with Supercars’ structure has put him off investing at an ownership level.
Adderton likened the current set-up to that of an apartment building where residents all have different opinions on what the garden should look like and ultimately nothing gets done.
“I’m just not going to suck up to the teams, because at the end of the day, they don’t seem to understand that making a stronger, better series is going to bring more advertisers,” he explained.
“I think I’d sit there and go, ‘Archer, what the hell have we bought?’ You buy a controlling interest in a company that you don’t actually control. It doesn’t make any sense.
“In order for these things to work, you’ve got to be able to have the power to make decisions,” he added.
“The NFL, NASCAR, IndyCar, they don’t go to the teams and ask for their advice. They don’t sit down with the teams over coffee and go, ‘What do you think about this?’ And them saying, ‘Nah I don’t really like that,’ they say, ‘Here’s the deal. This is where you’re running. See you on the track.’
“That’s how you build a sport, that’s how you build a company. You don’t let the shareholders run the company. You appoint a board in the company, but you appoint a CEO and a CEO’s responsibility is to run that company. If he doesn’t do a very good job he gets fired. But he’s not sitting there every day trying to get the shareholders to agree.
“I feel for Sean [Seamer, Supercars CEO]. It’s a tough job to run a company, it’s even tougher when you actually can’t make decisions without basically trying to get everybody else, who have all got their own self-interests, over the line.
“That does not work and I would never buy it unless they fix that up. It’s a whole range of things in there that don’t make sense. Good luck to the teams because they negotiated a great deal with Archer, but at the end of the day it’s not a workable solution. Until they fix that, I don’t know anyone who would buy it.”
Adderton remains optimistic that Supercars can be “one of the best sports in Australia”, but said its current structure is holding it back.
His belief is that Supercars needs its own dictator, akin to that of ex-Formula 1 supremo Bernie Eccelstone.
“Formula 1 was never bigger than when it was under Bernie, never,” said Adderton.
“As far as I’m concerned, Alan Gow with his British Touring Car Championship took the same approach. Tony Cochrane when he took that approach with Supercars.
“Again, I don’t know a business in the world that is run by a committee that has ever been successful that doesn’t implode and reorganize itself.
“Maybe that’s what has to happen with Supercars.”