Ryan Reynolds Buys Stake in F1 Racing Team, Growing His Business Empire
He joined investors like actor Michael B. Jordan in buying a 24% stake in the Alpine F1 team
He joined investors like actor Michael B. Jordan in buying a 24% stake in the Alpine F1 team
Actor and entrepreneur Ryan Reynolds is expanding his business empire into Formula One racing.
Reynolds and a group that includes celebrity American investors, such as his business partner and fellow actor Rob McElhenney, are buying a 24% stake in the Alpine F1 team for about $218 million, the team’s owner said Monday.
F1 races have become more popular in the U.S. in recent years, with celebrities packing into stands to watch drivers speed around a track. Alpine, a mid-tier team based in the U.K., is one of 10 F1 competitors.
The investors are buying a stake in Alpine Racing Ltd, the parent company of the Alpine team, according to Renault Group, a French auto manufacturer and the team’s owner. Renault said the new investors would bring expertise in marketing, merchandising and other areas.
The deal values the racing team at around $900 million, Renault said.
Reynolds, 46 years old, has long been a Hollywood star, with leading roles in comedy, action and rom-com films. He has used his marketing savvy to build an off-screen empire, purchasing stakes in the gin brand Aviation, the cell phone company Mint Mobile and a Welsh soccer team. T-Mobile US agreed to buy Mint Mobile earlier this year for about $1.35 billion and Diageo agreed in 2020 to pay as much as $610 million to acquire Aviation.
Reynolds started the production company and marketing agency Maximum Effort, named after his character’s catchphrase in the “Deadpool” movie franchise.
Alpine’s new investors include the actor Michael B. Jordan and private investment firms Otro Capital and RedBird Capital Partners. The firms have been affiliated with sports teams including the Dallas Cowboys and the French soccer club Toulouse FC.
Maximum Effort and representatives for Reynolds didn’t immediately return a request for comment. Representatives for Jordan declined to comment.
Reynolds and McElhenney are involved with another sports team, Wrexham AFC, a low-tier soccer club in North Wales that they bought in 2020. They chronicled their takeover of the struggling team and efforts to transform it in a 2022 FX docuseries, “Welcome to Wrexham.” The club this spring won a promotion out of the lowest tier of English soccer to the second-worst league.
The Alpine F1 team is featured in the Netflix series, “Formula 1: Drive to Survive,” which has drawn American fans to the sport since the show premiered in 2019.
F1 teams compete in many races each season. Several drivers represent each team and race in solo, aerodynamic cars.
The Alpine team has existed under different names for more than four decades. Renault renamed the team Alpine in 2021 after the company’s sports car brand, Société des Automobiles Alpine SAS. The team placed fifth and fourth out of 10 teams in 2021 and 2022, respectively.
Laurent Rossi, the chief executive of the Alpine team and the sports car brand, said in a statement Monday that the team wanted to catch up with top squads and invest in state-of-the-art facilities and equipment.
“This association is an important step to enhance our performance at all levels,” Rossi said.
Alpine said Monday that it aimed for its sports car brand to break even in 2026 and to generate more than $8.7 billion in revenue in 2030.
The team is based in the English village of Enstone, about 60 miles northwest of London.
This stylish family home combines a classic palette and finishes with a flexible floorplan
Just 55 minutes from Sydney, make this your creative getaway located in the majestic Hawkesbury region.
When will Berkshire Hathaway stop selling Bank of America stock?
Berkshire began liquidating its big stake in the banking company in mid-July—and has already unloaded about 15% of its interest. The selling has been fairly aggressive and has totaled about $6 billion. (Berkshire still holds 883 million shares, an 11.3% interest worth $35 billion based on its most recent filing on Aug. 30.)
The selling has prompted speculation about when CEO Warren Buffett, who oversees Berkshire’s $300 billion equity portfolio, will stop. The sales have depressed Bank of America stock, which has underperformed peers since Berkshire began its sell program. The stock closed down 0.9% Thursday at $40.14.
It’s possible that Berkshire will stop selling when the stake drops to 700 million shares. Taxes and history would be the reasons why.
Berkshire accumulated its Bank of America stake in two stages—and at vastly different prices. Berkshire’s initial stake came in 2017 , when it swapped $5 billion of Bank of America preferred stock for 700 million shares of common stock via warrants it received as part of the original preferred investment in 2011.
Berkshire got a sweet deal in that 2011 transaction. At the time, Bank of America was looking for a Buffett imprimatur—and the bank’s stock price was weak and under $10 a share.
Berkshire paid about $7 a share for that initial stake of 700 million common shares. The rest of the Berkshire stake, more than 300 million shares, was mostly purchased in 2018 at around $30 a share.
With Bank of America stock currently trading around $40, Berkshire faces a high tax burden from selling shares from the original stake of 700 million shares, given the low cost basis, and a much lighter tax hit from unloading the rest. Berkshire is subject to corporate taxes—an estimated 25% including local taxes—on gains on any sales of stock. The tax bite is stark.
Berkshire might own $2 to $3 a share in taxes on sales of high-cost stock and $8 a share on low-cost stock purchased for $7 a share.
New York tax expert Robert Willens says corporations, like individuals, can specify the particular lots when they sell stock with multiple cost levels.
“If stock is held in the custody of a broker, an adequate identification is made if the taxpayer specifies to the broker having custody of the stock the particular stock to be sold and, within a reasonable time thereafter, confirmation of such specification is set forth in a written document from the broker,” Willens told Barron’s in an email.
He assumes that Berkshire will identify the high-cost Bank of America stock for the recent sales to minimize its tax liability.
If sellers don’t specify, they generally are subject to “first in, first out,” or FIFO, accounting, meaning that the stock bought first would be subject to any tax on gains.
Buffett tends to be tax-averse—and that may prompt him to keep the original stake of 700 million shares. He could also mull any loyalty he may feel toward Bank of America CEO Brian Moynihan , whom Buffett has praised in the past.
Another reason for Berkshire to hold Bank of America is that it’s the company’s only big equity holding among traditional banks after selling shares of U.S. Bancorp , Bank of New York Mellon , JPMorgan Chase , and Wells Fargo in recent years.
Buffett, however, often eliminates stock holdings after he begins selling them down, as he did with the other bank stocks. Berkshire does retain a smaller stake of about $3 billion in Citigroup.
There could be a new filing on sales of Bank of America stock by Berkshire on Thursday evening. It has been three business days since the last one.
Berkshire must file within two business days of any sales of Bank of America stock since it owns more than 10%. The conglomerate will need to get its stake under about 777 million shares, about 100 million below the current level, before it can avoid the two-day filing rule.
It should be said that taxes haven’t deterred Buffett from selling over half of Berkshire’s stake in Apple this year—an estimated $85 billion or more of stock. Barron’s has estimated that Berkshire may owe $15 billion on the bulk of the sales that occurred in the second quarter.
Berkshire now holds 400 million shares of Apple and Barron’s has argued that Buffett may be finished reducing the Apple stake at that round number, which is the same number of shares that Berkshire has held in Coca-Cola for more than two decades.
Buffett may like round numbers—and 700 million could be just the right figure for Bank of America.
This stylish family home combines a classic palette and finishes with a flexible floorplan
Just 55 minutes from Sydney, make this your creative getaway located in the majestic Hawkesbury region.