NHRA going public? (1 Viewer)

[BJN]

heres food for thought..........



14 Nov 2007 18:49 CST WSJ(11/15) Breaking Insight From WSJ.com

(From THE WALL STREET JOURNAL) Hot Rods Head

For IPO Track

---

Association Shifts Gears

With Pro-Racing Unit;

From Fans to Investors?

The National Hot Rod Association is about to be in a league of its own.

The NHRA's pro-racing arm is gearing up for a change in ownership that would transform it from a 57-year-old nonprofit organization into a publicly traded entity. (It would join the tiny U.S. Basketball League and American Basketball Association as publicly traded sports bodies.)

The structure would be the culmination of a $121 million buyout of the drag-racing business announced in May by HD Partners Acquisition.

Eddy Hartenstein -- along with partners Larry Chapman and Steve Cox, who helped build satellite-TV giant DirecTV in the 1990s -- says they can double the Hot Rod circuit's $11 million in annual cash flow in three years, in part by expanding sponsorships and TV viewership of its 23 events. Those events can draw as many as 125,000 people over a weekend, they say, adding that it is the second-largest race-car league after Nascar.

The Hot Rod plan makes us wonder whether this could be a trend. Could 75 million Nascar fans one day get to support their league in another way -- by buying shares? Or could the NFL, NBA or NHL give fans a chance to share in the billions of dollars of profits they generate? It wouldn't be hard to think up ticker symbols.

-- Dana Cimilluca

 

[67 Cuda]

I would buy shares in NHRA if it was available.

 

[Toejam]

I just hope it as cheap as CKYX stock!

 

[JL]

I will consider it if the purses will go up...

 

[mike]

I just hope it as cheap as CKYX stock!

LOL, CHEEKY JOE!!!

You know one thing that really scares me about this new deal, is that in the next few years they might shut everyone away from the pits, has anyone thought of this? :/

 

[Wes]

That would be a very easy way for Bruton and Co. to take control...buy 51.1% of all shares during the IPO. Hmmmmmm. I'd buy shares if SMI were at the helm...but no interest as long as HDP/TC are in charge.

 

[TJ]

Some NHRA team owners/crewmembers have already received their shares....
These shares will provide dividends for evryone involved.....And the proxy meetings will be top shelf...Check back in April for the report and spreads...

BTW...Bruton and his venture groups cannot take control w/ a % majority...It's a lock-out....like most other public stock offerings....

 

[Toejam]

LOL, CHEEKY JOE!!!

You know one thing that really scares me about this new deal, is that in the next few years they might shut everyone away from the pits, has anyone thought of this? :/

MV, that would do more damage to this sport than anything!

 

[DrRocket]

LOL, CHEEKY JOE!!!

You know one thing that really scares me about this new deal, is that in the next few years they might shut everyone away from the pits, has anyone thought of this? :/

I think this is a VERY real possibility. The insurance underwriters will get the ear of the board of directors, and warn them that as long as you have spectators milling around uncontrolled in the pit areas, they're opening themselves up to HUGE lawsuits!

Besides.......................

*in a quiet voice mulling possibilities.......If we sold pit passes for $25 and tightly controlled their access, i.e. where they can go and who they can see, like another certain engineering entertainment venue we're all familiar with..........

 

[CrewMan]

Well there is this nasty little thing in the publicly owned company world called:

SARBANES OXLEY ACT

For those who are not familiar this came in the wake of the Enron horseshyt. It is basically a bunch of checks and balances, but let me tell you from first hand experience, I don't think the racing world could comply with it. If you have had any dealing with "compliance" you know it is impossible to meet...even worse than OSHA regs.

 

[Kelly]

Well there is this nasty little thing in the publicly owned company world called:

SARBANES OXLEY ACT

For those who are not familiar this came in the wake of the Enron horseshyt. It is basically a bunch of checks and balances, but let me tell you from first hand experience, I don't think the racing world could comply with it. If you have had any dealing with "compliance" you know it is impossible to meet...even worse than OSHA regs.

That's the first thing I thought of! We went public last year and OMG! The SOX compliance is hard for our office......I couldn't imagine making it work for NHRA!

 

[Nunz]

This is not an IPO for NHRA, the IPO was done for HD Partners, where they raised the cash to allow them to search for an acquisition candidate. NHRA will end up being publicly traded as a result of this deal closing. For those looking for an opprtunity to buy into NASCAR, Bruton Smith is CEO of Speedway Motorsports, which is publicly traded under the symbol TRK, it's approx. $36/share.

 

[CrewMan]

Right...but what I am saying...is any investor could ask to see just about anything. Meaning, and this may be a stretch, they could concievable ask for expidenture details, etc. And that means HD would have to get it from the teams because if I understand this right...doesn't HD own the "pro teams" in a sense? I may be misunderstanding this...but I don't see this as a good thing.

Can you see NHRA trying to project earnings?

 

[Nunz]

HD will not own any teams unless they go buy some. Buying the NHRA Pro Division does not give them any guarantee of what teams will run their series. So, privately owned race teams can keep their budgets private.

 

[d'kid]

HD will not own any teams unless they go buy some. Buying the NHRA Pro Division does not give them any guarantee of what teams will run their series. So, privately owned race teams can keep their budgets private.

or to put it another way, HD is buying the right to Promote NHRA Pro Drag Racing. And a couple of race tracks. Which again brings up the question, what if they held a party and nobody came?

And here comes the big question, is it going to be a separate rule book with just the pro classes in it. Are they going to pay the NHRA for use of the Safety Safari... Will NHRA Pro be a separate membership, If so, how much a year? Will there be a separate National Dragster just for the pro side?

A long time FAN, NHRA PRO's Customer wants to know if I even want to "BUY" their Product....

d'kid

 

[mick]

is nhra/hd going public soon? or will they go public after 2 or 3 years?

public offering now certainly would give nhra/hd operating capital
to 'expand' or do whatever they're going to do

public offering later, after having grown the brand, would give hd
their investment back and then some if they decide to step aside.

?????

 

[MaC]

Mike,

HD Partners is a public company, their stock, listed as HDP, closed today at 7.66. It has been an open company since prior to the announcement the middle of the year. Hope this helps.

DMaC

 

[DixonFan]

Its just plain crazy that anyone would put there money into a sinking ship

 

["Dr. Dirt"]

Its just plain crazy that anyone would put there money into a sinking ship

. . . but Tommy Boy's still at the helm so there's nothing to worry about, right?

 

[Marchboom]

Just wondering, what power, if any, do the NHRA members have if they go public?


Also,
Access to the pits is just as important to me as the racing. This part of what makes drag racing so popular.