McLaren confirm selling stake in deal worth £560m

Date published: December 13 2020 - Mark Scott

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McLaren has sold an initial 15 per cent stake in their Formula 1 team to a group of US investors, with the deal confirmed prior to the Abu Dhabi Grand Prix. 

McLaren’s quest for additional funding has been no secret throughout the 2020 season, especially when the initial Formula 1 campaign was put on hold due to the global health pandemic which put financial strain on all teams.

Back in May, McLaren Group announced they were going to cut 1,200 staff numbers from its operation (around 70 of which came from the Formula 1 team) and, soon after, also secured a £150million loan from National Bank of Bahrain after their initial approach to the UK government was rejected.

McLaren continued to explore other ways to ease the financial burden and also arranged the sale and leaseback of its McLaren Technology Centre.

And now, at the end of an extremely difficult year, McLaren are selling an initial 15 per cent stake in the Formula 1 team to a US-based group called MSP Sports Capital.

As Sky News first reported, the deal now values McLaren Racing at £560million ‘after the injection of the £185m of equity’.

The consortium led by MSP Sports Capital includes ‘The Najafi Companies, a private investment firm, and UBS O’Connor, a hedge fund subsidiary of the Swiss investment banking giant’.

Another Sky source believes that initial selling of a 15 per cent stake can rise to a maximum of 33 per cent by the end of 2022.

Fernando Alonso tests for McLaren at Bahrain in 2019

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As part of the deal, MSP’s Jeff Moorad is set to become an non-executive director of McLaren Racing. Moorad was one of the names linked to buying the team formerly known as Force India before Lawrence Stroll led a successful takeover with his consortium.

MSP’s investment portfolio includes baseball’s Arizona Diamondbacks and San Diego Padres, plus football teams in the Spanish and Portuguese leagues.

McLaren boss Zak Brown said upon confirmation of the deal that this is an important step in the progression of the Formula 1 team.

“This investment represents a key moment in the progress of McLaren Racing,” Brown said.

“MSP Sports Capital is first and foremost a sports investor. They know the market and their team has considerable experience and proven success in global sports properties.

“They are a partner as much as a shareholder, with the ability to leverage their network and knowledge for the long-term benefit of McLaren Racing.

“This new investment bolsters our plan to return McLaren to contention for race wins and championships in Formula 1 and IndyCar, and will strengthen our positive momentum as we continue to focus relentlessly on our mission to return to the top of the podium.”

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