McLaren could sell a minority stake in its F1 team - report

File picture: Chuck Burton / AP Photo.

File picture: Chuck Burton / AP Photo.

Published Jun 18, 2020

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London - McLaren is considering selling a minority stake in its once-dominant Formula One team to raise funds to help the company weather the Covid-19 crisis, Sky News reported on Wednesday.

It said the proposal was at a 'conceptual stage' alongside other options, including raising capital from existing bondholders.

There was no immediate comment from McLaren.

Bahrain’s Mumtalakat holding company is the majority shareholder in McLaren Group, with a 56% stake, followed by the TAG Group led by Saudi-born businessman Mansour Ojjeh with 14%.

Canadian businessman Michael Latifi acquired a stake of around 10% in 2018.

McLaren finished fourth overall last season with Spaniard Carlos Sainz, who is joining Ferrari next year, and Britain's Lando Norris.

The Woking-based outfit, winners of eight constructors' championships, last won a grand prix in 2012 and a title, with now six times world champion Lewis Hamilton, in 2008.

The Covid-19 pandemic has hit the sportscar maker hard, with sales plunging during the factory shutdown. The company announced 1200 redundancies in May under a group-wide restructuring.

The group - which is made up of the Automotive, Racing and Applied divisions - saw its pre-tax loss balloon to 133 million pounds in the first quarter of 2020 from a previous 18 million.

McLaren said then that it was "looking at a number of potential financing alternatives, secured and unsecured, of up to 275 million pounds equivalent to strengthen its liquidity position."

Formula One is introducing a $145 million annual budget cap next year, falling subsequently to $135 million, which should help teams such as McLaren compete on a sustainable basis.

Old rival Williams, also once-dominant but now struggling financially, are also considering a range of options including the sale of its team.

The delayed season is due to start in Austria on July 5 without spectators. 

Reuters

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