Public corporation buys NHRA rights

The National Hot Rod Association has signed an agreement to sell all rights to its professional racing series and its racetracks to publicly held HD Partners Acquisition Corporation.

Pending approval from the Securities and Exchange Commission and HD stockholders, the deal announced late Wednesday afternoon would mark the first time in the 56-year history of the country’s oldest and largest drag racing organization that it did not control the sport’s biggest pro tour.

Both groups announced the $121 million deal that gives HD ownership of the 23-event NHRA Powerade Drag Racing series. The new venture is NHRA Pro Racing.

In the agreement, HD gets NHRA-owned tracks in Atlanta; Columbus, Ohio; Gainesville, Fla.; and Clermont, Ind.

The deal includes NHRA’s long-term lease of the dragstrip at the Fairplex in Pomona, Calif., which hosts two major NHRA races annually, and ownership of NHRA headquarters in nearby Glendora.

NHRA is to receive $100 million in cash, $9.5 million in HD common stock and $11.5 million for debt and liabilities.

The announcement came as a surprise to veteran drag racer and team owner Kenny Bernstein, who is president of drag racing’s Professional Racers Owners Organization.

“Not a single, solid person or an ant has said anything to me,” Bernstein said when told of the announcements by HD and NHRA.

Few people other than top HD and NHRA executives probably were aware of talks leading to the agreement because of SEC regulations of publicly held corporations for possible stock manipulation.

Bruton Smith, founder and chief executive of Speedway Motorsports Inc., which owns Las Vegas Motor Speedway and two other tracks with NHRA pro events, has shown interest for more than a year in purchasing NHRA.

Smith could not be reached for comment.

The news was surprising to Chris Powell, general manager of LVMS, which hosts two NHRA pro tour events. He said he learned of the deal when the news release was distributed.

“I don’t see it having any negative impact on our events at the speedway,” Powell said. “Our events have proven to be two of the most well attended in NHRA, and I fully expect that to be the case in the future.”

NHRA, a nonprofit 501(c)(6) corporation, will remain the caretaker of the sport’s non-professional racing programs and safety and educational activities. It will continue as the sanctioning body for all NHRA racing events, including the professional NHRA Powerade Drag Racing Series.

Eddy Hartenstein, chairman and chief executive of HD, based in Santa Monica, Calif., started the company a year ago with the purpose of acquiring assets of businesses in “media, entertainment or telecommunications industries,” according to its press release.

Hartenstein, 55, and several of HD’s top executives held senior management roles in DirectTV Inc. when it was formed in 1990.

If the transaction is approved, Hartenstein will serve as NHRA Pro Racing chairman, and NHRA president Tom Compton will become president and chief executive of NHRA Pro Racing.

• FORMULA ONE — Formula One’s governing body cleared the McLaren team of any wrongdoing Wednesday in its 1-2 finish at the Monaco Grand Prix.

The FIA opened a probe Monday into possible rules violations after the team ordered Lewis Hamilton not to challenge Fernando Alonso in Sunday’s race. Alonso finished first, 4.095 seconds ahead of Hamilton.

The FIA dropped the case after studying the radio traffic between the team and its drivers, and the FIA observer’s report from the race determined the team did nothing wrong, The Associated Press reported.

Alonso, the two-time defending F1 champion, and Hamilton, a rookie driver, are tied atop the standings with 38 points after five races.

News Headlines
Add Event
Home Front Page Footer Listing
You May Like

You May Like