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Opinion

Santander’s ECM formula

Santander spends huge sums promoting its brand in the glorified world of Grand Prix racing. It sponsors races across continents. Its chairman Emilio Botín is often seen in the pit lane.

And, after the first six races this year, Santander is having a successful season. It is lead sponsor of a Ferrari team, whose top driver, Spaniard Fernando Alonso, has surprised many by steering a supposedly weak car to the top of the drivers’ standings.

However, that’s not the only surprise result in Formula One this year. The CVC-owned business is in the process of launching an IPO into an Asian equity market as dry for deals as a season-end race in Abu Dhabi.

Looking down the grid of lead managers, it’s no surprise to see turbo-charged Asian ECM vehicles such as Goldman Sachs, UBS and Morgan Stanley as global coordinators. We can understand why, given the business is floating on the Singapore exchange, the likes of DBS and CIMB are also in the race.

But Santander? Even Don Emilio would not claim his firm is much more than an old banger in equities, and it’s not even a concept car in Asia, where it has never been on a high-profile equity deal before.

Did the wily F1 chief do his top sponsor a favour by putting Santander on the IPO ticket? Or will the bank use the popularity of F1 in its core home markets of Spain, the UK, Germany and Brazil to promote the shares to investors?

We will see.

However, first CVC needs to decide if it will ‘go, go, go’ for the deal. The poor performance of Facebook’s IPO has led some to suggest F1 could itself be red-flagged. At the moment, it seems, the lead managers are carefully following the safety car on this one.

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