McLaren Racing, which oversees the manufacturer’s involvement in F1 and in IndyCar, is reportedly considering an equity sale to raise funds to help secure its future.
A report from Sky News contends that McLaren has initiated discussions about such a plan with its advisers this week, insisting the idea is at “a conceptual stage” and is being weighed alongside alternative funding options such as “raising capital from existing bondholders”.
Formula 1’s current economic downturn sparked by the coronavirus pandemic that has disrupted the 2020 season has hit teams hard, but especially the sport’s midfield outfits which must contend with a massive shortfall in revenue.
F1 commercial rights holder Liberty Media has implemented a series of measures for this year and for 2021 to dampen the effects of the financial crisis
But raising funds to weather the storm would perhaps add another level of protection for McLaren Racing, whose parent company – the McLaren Group – has recently cut staffing levels and is in the process of seeking up to £275m in liquidity to weather the storm in the global automotive industry.
McLaren Group’s current shareholders include Bahrain sovereign wealth fund Mumtalakat which owns a 56% stake in the company, historic shareholder Mansour Ojjeh who owns 14% and Canadian businessman Michael Latifi how holds a 10% stake, with the remaining 20% in the hands of various minority shareholders.
On paper, Latifi is considered as a prime candidate to provide funding directly to McLaren Racing.
However, the father of Williams charger Nicholas Latifi is also financially involved with the Grove-based outfit, having provided a loan to Williams Grand Prix Holdings, and is seen as a potential suitor for the team which the Williams family has put up for sale.