The Vote Doesn't Matter...

[JoeBob]

http://biz.yahoo.com/prnews/031202/nytu207_1.html


Championship Auto Racing Teams, Inc. Announces that Conditions of the Proposed Merger with Open Wheel Racing Series Are Not Likely to be Satisfied

INDIANAPOLIS, Dec. 2 /PRNewswire-FirstCall/ -- Championship Auto Racing Teams, Inc. ("Championship" or "Company") (OTC Bulletin Board: CPNT.OB - News) announced today that representatives of Open Wheel Racing Series ("OWRS") informed the company that OWRS believes that a number of conditions of the pending merger between the parties will not be satisfied by the time of the special meeting of stockholders scheduled for December 19, 2003. Championship has considered OWRS' position and believes that it is unlikely that the condition requiring the absence of a material adverse effect will be satisfied because it expects that there will be a net decrease in the number of teams planning on participating in the series for the 2004 season from the number that participated in the 2003 season. OWRS has indicated it will not waive any condition of the closing. In light of the foregoing, Championship's board of directors is evaluating available alternatives to the merger, including the possibility of ceasing operations, winding up the Company's affairs and liquidating its remaining assets. In addition, OWRS has made a preliminary proposal contemplating an alternative transaction under which Championship and its subsidiary CART, Inc., would commence reorganization cases under Chapter 11 of the Bankruptcy Code and OWRS would purchase certain assets of the Company and/or CART, Inc., and assume certain liabilities. OWRS advised the Company that under the OWRS proposal, OWRS would continue the Champ Car Racing Series in 2004. Although Championship is reviewing this proposal there can be no assurance that any agreement will be entered into or that any transaction, if completed, will result in any payments to stockholders.

Open Wheel Racing Series is a newly formed holding company owned indirectly by a group of investors including Gerald R. Forsythe, Kevin Kalkhoven and Paul Gentilozzi. OWRS currently has beneficial ownership of 3,377,400 shares of Championship common stock, approximately 22.9% of the outstanding shares of Championship.

About Championship Auto Racing Teams, Inc.

Championship Auto Racing Teams, Inc. (OTC Bulletin Board: CPNT.OB - News) owns, operates and markets the 2003 Bridgestone Presents The Champ Car World Series Powered by Ford. Veteran racing teams such as Newman/Haas Racing, Player's/Forsythe Racing, Team Rahal, Patrick Racing and Walker Racing competed with many new teams this year in pursuit of the Vanderbilt Cup. CART Champ Cars are thoroughbred racing machines that reach speeds in excess of 200 miles per hour, showcasing the technical expertise of manufacturers such as Ford Motor Company, Lola Cars, Walker Racing LLC, (Reynard) and Bridgestone/Firestone North American Tire, LLC. The 18-race 2003 Bridgestone Presents The Champ Car World Series Powered by Ford was broadcast by television partners CBS and SPEED Channel. CART also owns and operates its top development series, the Toyota Atlantic Championship. Learn more about CART's open-wheel racing series at www.champcarworldseries.com.

This should actually allow OWRS to buy the series for less money, and maybe even in less time. They'd go to court with a plan, and funding to continue the business.

[nrc]

Vanini gets zip and I get an itoldjaso. :D

I don't think they will. They'll start something separate and run an abbreviated season on their own first. Then they'll pick up the pieces they want when CART goes under. They may have to fight the IRL for a couple of choice morsels, but Gerry will do that before he spends his own money for the benefit of the other shareholders.

[jonovision_man]

Assuming someone can pick up enough of the pieces to form a new series from the ashes, that still leaves the matter of getting enough teams together for a grid.

Not only that, they are starting fresh, they'll have to negotiate contracts with venues, etc...

I don't think there's a snowball's chance in hell we'll see CART in 2004, this announcement pretty much ends the season.

2005, maybe, but then you have the matter of trying to get all those teams together again, and most people will already have moved onto the IRL, NASCAR, etc...

It would be more like forming an entirely new series than keeping CART going.

:( :( :( :( :(

I think this is the end.

jono

[JLMannin]

This seems reasonable. As long as USAC/IRL exist (I perceive them the same: indycentric sanctioning bodies), it creates a void in US formula car racing that needs filling. Opening the gates at IMS each May was not a viable marketing plan for the series in the '70's, and thirty-some years later, it is still not a viable option.

[JLMannin]

Originally posted by jonovision_man
It would be more like forming an entirely new series than keeping CART going.jono

That, my friend, will be inevitable if CART goes **** up. TG/USAC/IRL create voids that need filling.

[jonovision_man]

Originally posted by JLMannin
That, my friend, will be inevitable if CART goes **** up. TG/USAC/IRL create voids that need filling.

Agreed.

IRL would have to change a lot to fill the void CART leaves. Start with changing the formula, and don't stop until all the street/road circuits CART is leaving behind have races...

The Molson Indy folks are in talks with ALMS and have been in touch with the IRL, according to the Canadian press. The show must go on... hope that doesn't mean the end of ALMS at Mosport, though!

I wonder if there's any role here for F1, Bernie, etc? He's always wanted to get into the U.S. market in a serious way, this void could be his opportunity.

jono

[Ankf00]

wouldn't TG/toyo try to steal LBGP and Toronto contracts in liquidation? why would OWRS get preference to purchase those contracts? tg solves all his problems by killing any possible formula car rival :(

[nrc]

So was this what Ziggy was talking about? Does OWRS already have plan B ready to roll out? Keep in mind that the fact that CART does have the money to line teams up for next year doesn't mean that OWRS can't.