Mercedes is preparing its exit from F1
Mercedes will significantly reduce its stake in the team while INEOS becomes a shareholder. Toto Wolff also confirmed that he would remain for at least three more years.
In February, Mercedes announced the arrival of a new sponsor, INEOS. It appeared on the rear face of the rear wing and on the air intake above the drivers. But already at that time, we had mentioned that this could quickly result in an entry into the capital because Sir Jim Ratcliffe is not accustomed to just putting a logo on an organization but prefers to fully own the team, as is the case with OGC Nice or the cycling team.
It is now done with the announcement that he would now hold a third of the team’s capital: « When we arrived in Formula 1 earlier in the year, we chose to do so with Mercedes, which is the reference. Since then, we have had discussions to see how we can increase our involvement. This is a unique opportunity to make a financial investment in a top team but one that still has the potential to grow. »
This opportunity arose from the conjunction of two elements. The first is the death of Niki Lauda last year. The triple world champion held 10% alongside Toto Wolff (30%) and Mercedes. The second is a reduction in Mercedes’ financial exposure, shaken like the rest of the automotive industry by the health and financial crisis. Thus, the manufacturer has reduced its stake from 60% to 33%, which will make the three co-shareholders equal in terms of participation with the slight increase in the share held by Toto Wolff.
Of course, officially, there is no question of withdrawing from F1, as affirmed by Ola Källenius, the president of Daimler: “We remain fully committed to Formula 1. The upcoming introduction of the cost cap and this new shareholder structure put us in an even better position to maintain our successes. With an even closer alignment with our Mercedes-AMG division in 2021 and the continuity of Toto’s leadership for the years to come, the future looks bright for Mercedes-Benz in Formula 1.”
However, it is much easier to give up a third of the capital than 60%, especially if one of the two current shareholders is keen to increase their stake even further. It is not forbidden to think that INEOS might want to take the majority, or even all of the capital to eventually change the name to INEOS, similar to what Red Bull has done. Mercedes could then be content with being an engine supplier to still be officially involved in F1 while reducing its overall budget.
