Saudi Arabia contributes to £550m boost for McLaren Group

The McLaren Group has been given a £550m boost of fresh investment that will help to secure the future of the parent company of the Formula 1 team.

Saudi Arabia contributes to £550m boost for McLaren Group

Much of the new funding comes from Saudi Arabia's Public Investment Fund [PIF], with some coming from existing investors, including Bahrain's Mumtalakat.

McLaren says that £400m has been sourced in return for preference shares from "global alternative investment manager" Ares Management and PIF.

The existing shareholders have been joined by what McLaren calls "a limited number of new private investors" in investing an additional £150m of capital in the form of convertible preference shares.

McLaren says that the deal allows for the repayment of the loan received just over a year ago from the National Bank of Bahrain, and notes that the completion of arrangements "remains subject to mutually agreed closing conditions."

Read Also:

Saudi Arabia has already established a presence in the sport as a major partner of the F1 organisation, via the Aramco petrochemical concern.

The country is also due to host its first grand prix at the new Jeddah street track in December.

Aramco is one of many entities owned by PIF, which has been spending heavily internationally in the last couple of years.

It has declared interests in a range of major names, including Boeing, Disney, CitiCorp, Facebook, BP and Marriott. Other companies in its portfolio include Uber, Tesla and Total.

McLaren Group executive chairman Paul Walsh said: "Building on the short term measures that we put in place last summer in response to the global pandemic, McLaren has taken a number of significant steps to put the company on a stable footing for the long term, with the close support of its advisors and existing shareholders.

"Following the strategic investment into Racing that we secured last year, this successful equity raise is a key element of our comprehensive financial strategy to support the Group's sustainable growth plans."

Walsh made it clear that the road car business will benefit from the new deals: "With these strong foundations now in place, we are well positioned to achieve our ambitions as a global luxury supercar and elite motorsport business, with Automotive as McLaren's core profit driver.

"The strong appetite we have seen from investors reflects the continued confidence in McLaren's iconic brand, industry-leading technology and exciting long term growth prospects, underpinned by a more focused strategy and a stronger, more efficient capital structure.

"We look forward to working with Ares and PIF as they contribute their experience and knowledge to the board."

shares
comments

Related video

Where seconds count: How McLaren engineering has inspired Richard Mille timepieces
Previous article

Where seconds count: How McLaren engineering has inspired Richard Mille timepieces

Next article

British GP: Verstappen outpaces Norris by 0.7s in FP1

British GP: Verstappen outpaces Norris by 0.7s in FP1
Load comments
The factors that could negate Red Bull's practice gap to Mercedes Prime

The factors that could negate Red Bull's practice gap to Mercedes

Mercedes led the way in practice for Formula 1’s first race in Jeddah, where Red Bull was off the pace on both single-lap and long runs. But, if Max Verstappen can reverse the results on Saturday, factors familiar in motorsport’s main electric single-seater category could be decisive in another close battle with Lewis Hamilton...

Why Norris doesn’t expect Mr Nice Guy praise for much longer Prime

Why Norris doesn’t expect Mr Nice Guy praise for much longer

Earning praise from rivals has been a welcome sign that Lando Norris is becoming established among Formula 1's elite. But the McLaren driver is confident that his team's upward curve can put him in the mix to contend for titles in the future, when he's hoping the compliments will be replaced by being deemed an equal adversary

Formula 1
Dec 2, 2021
What Ferrari still needs to improve to return to F1 title contention Prime

What Ferrari still needs to improve to return to F1 title contention

After a disastrous 2020 in which it slumped to sixth in the F1 constructors' standings, Ferrari has rebounded strongly and is on course to finish third - despite regulations that forced it to carryover much of its forgettable SF1000 machine. Yet while it can be pleased with its improvement, there are still steps it must make if 2022 is to yield a return to winning ways

Formula 1
Dec 2, 2021
How F1 teams and personnel react in pressurised situations Prime

How F1 teams and personnel react in pressurised situations

OPINION: The pressure is firmly on Red Bull and Mercedes as Formula 1 2021 embarks on its final double-header. How the respective teams deal with that will be a crucial factor in deciding the outcome of the drivers' and constructors' championships, as Motorsport.com's technical consultant and ex-McLaren F1 engineer Tim Wright explains.

Formula 1
Dec 1, 2021
How getting sacked from Benetton made Mercedes' Allison Prime

How getting sacked from Benetton made Mercedes' Allison

He’s had a hand in world championship-winning Formula 1 cars for Benetton, Renault and Mercedes, and was also a cog in the Schumacher-Ferrari axis. Having recently ‘moved upstairs’ as Mercedes chief technical officer, James Allison tells Stuart Codling about his career path and why being axed by Benetton was one of the best things that ever happened to him.

Formula 1
Nov 28, 2021
The remarkable qualities that propelled Kubica’s F1 comeback Prime

The remarkable qualities that propelled Kubica’s F1 comeback

It’s easy to look at Robert Kubica’s second Formula 1 career and feel a sense of sadness that he didn’t reach the heights for which he seemed destined. But as Ben Anderson discovered, performance and results are almost meaningless in this context – something more fundamental and incredible happened…

Formula 1
Nov 27, 2021
The humbling changes Ricciardo made to deliver for McLaren Prime

The humbling changes Ricciardo made to deliver for McLaren

From being lapped by his own teammate in Monaco to winning at Monza, it’s been a tumultuous first season at McLaren for Daniel Ricciardo. But, as he tells STUART CODLING, there’s more to the story of his turnaround than having a lovely summer holiday during Formula 1's summer break...

Formula 1
Nov 26, 2021
The potential benefits of losing the F1 constructors' title Prime

The potential benefits of losing the F1 constructors' title

As the battle continues to rage over the F1 2021 drivers' championship, teams up and down the grid are turning their attentions to the prize money attributed to each position in the constructors' standings. But F1's sliding scale rules governing wind tunnel and CFD use will soften the blow for those who miss out on the top places

Formula 1
Nov 25, 2021