Woking is for sale

If McLaren nearly returned to victory last week in Monza, its financial situation remains a concern for the management. Last May, the British manufacturer announced it had to part with 1,200 employees, which is a quarter of its workforce. Two months later, it was necessary to secure a loan of 150 million pounds from the national bank of Bahrain, its majority shareholder.

The start of the season has triggered the disbursement of funds by Liberty Media and the team’s sponsors. However, the team must still ensure its sustainability, particularly regarding its liquidity. That is why it has just appointed advisory banks to execute a sale and leaseback on its Technology Center in Woking. It aims to raise nearly 200 million pounds but intends to remain a tenant of the premises.

Zak Brown confirmed to the official F1 website: “We are going to execute a traditional sale-leaseback. The majority of companies around the world do not own the real estate they occupy. We have a lot of funds tied up in this building, and it’s not a very productive use of those funds when you’re looking to invest in our business. We will sell the building to someone else. We will then sign an extremely long-term lease agreement and use that money to grow our business. It’s a fairly straightforward financial restructuring.”

The idea is to raise fresh money immediately in order to invest in the company and therefore advance further up the hierarchy. In exchange, McLaren will then have to pay rent to its new owner. The idea is that this rent will be lower than the additional revenue generated by the initial investments: « We have a good five-year business plan for this new era of Formula 1. I am confident that we have the resources and people to allow us to climb back to the top of the grid. » This business plan is based on the recent signing of the Concorde Agreements, which will govern commercial relationships for the years to come.