McLaren given massive valuation figure amid sale reports

McLaren’s majority owners are looking to increase their stake in the British marque in a deal that values the operation at £3billion.

Mumtalakat and CYVN, who hold approximately 70 per cent of McLaren Racing between them, are reportedly poised to acquire the remaining 30 per cent.

MSP Sports Capital set for £800m profit

McLaren has completed a remarkable on-track transformation in recent years, from also-rans as recently as 2022 to the sport’s dominant force. However, its off-track performance is arguably even more remarkable.

In 2020, the business faced a tough battle simply to survive as financial issues threatened to cripple the broader McLaren Group.

That triggered a host of redundancies, including within the F1 team, while the Racing arm went into the market for fresh investment.

It secured funding from MSP Sports Capital in December 2020 in a deal that valued the race team at £560million ($757.6m). The transaction left MSP with an initial 15 per cent holding, raising to 33 per cent by the end of 2022.

According to Sky Sports, MSP is now looking to offload its investment in a transaction that would value McLaren Racing at £3billion ($4.06bn). That equates to a profit of over £800million ($1.08bn) in less than five years.

Mumtalakat, the sovereign wealth fund of the Kingdom of Bahrain, is McLaren Racing’s majority owner. In May, it posted its best annual financial results on record, with profits of Bahraini Dinar 363million (£711.8m; $969.2m).

Together with its stake in McLaren, Mumtalakat also has interests in the Bahrain International Circuit, FAI Aviation Group, National Bank of Bahrain, Prodrive International, among a host of others.

In April, it was confirmed that CYVN Holdings had completed an acquisition transaction of McLaren’s automotive business and a non-controlling stake in its Racing activities.

CYVN Holdings is owned by the government of Abu Dhabi. It also owns Gordon Murray Technologies and a slice of Chinese electric vehicle maker Nio.

According to Sky News, the McLaren deal would leave Mumtalakat and CYVN with complete control of the operation.

McLaren’s £3billion valuation tallies with estimates made by Sportico, which monitors the business of sports, last month.

Formula 1 has become an attractive platform for investors in recent years, with the value of teams soaring in the modern era.

That growth has been built on a number of key developments, from the opening up of the sport to new and social media, to financial regulations designed to limit what teams are able to spend.

Changes to the Concorde Agreement have also seen a redistribution of prize money, reducing the disparity in payments from the front of the field to the back.

Combined, it has created a more sustainable environment which, coupled with increased exposure, has witnessed tremendous – and continuing – growth globally.

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According to its most recent publicly available accounts, McLaren posted a 2023 financial year profit of £12.9million, a significant turnaround from the £57.8million loss the year prior.

An improved commercial outlook since 2023, in addition to on-track success that netted McLaren its first Constructors’ Championship in two decades, is expected to have driven further positive results in 2024.

Success last year will also have a carryover into the current campaign, with prize money paid out on Formula One’s Management’s 2025 revenue based on the finishing order of last year’s teams’ championship.

That means McLaren will take the largest piece of the pie owing to its title win last year. Indeed, that state of affairs is likely to continue next year too, with Oscar Piastri and Lando Norris poised to deliver McLaren another Constructors’ Championship this season.

McLaren has also introduced a raft of commercial deals, most notably a naming partnership deal with Mastercard, set to begin in F1 2026.

That marks an expansion on an existing relationship and ends a 12-year stint without a title sponsor. It’s been suggested the deal is worth £74million ($100m) annually.

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