The Middle East remains the source of McLaren’s finances. The Bahraini company Mumtalakat Holding Company owns 56.40% of its shares and now the McLaren Group has confirmed a share package worth 643 million euros to the Saudi Public Investment Fund.
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€ 468 million of the 643 would go to provide Ares Management – a global investment company – with new capital. McLaren shareholders – Mumtalakat, TAG and Michael Latifi – would put the remaining 175 million into the group.
It seems like the Papaya team, which had a strong time on the track this season, had financial problems behind the scenes.
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Positive news for our major shareholder, the McLaren Group, with new investments of £ 550 million under a long-term financial plan
– Zak Brown (@ZBrownCEO) July 16, 2021
McLaren started their year on a whopping £ 150 million loan. They received this loan from the National Bank of Bahrain. That year the headquarters were also sold for 200 million euros. The death of McLaren’s greatest supporter and CEO of TAG, Mansour Ojjeh, has further rocked McLaren’s financial position.
Financial 2020 for McLaren
The pandemic has certainly put a heavy strain on McLaren’s finances over the past year. Ahead of the 2020 Formula 1 season, McLaren agreed to the $ 150 million loan with the National Bank of Bahrain. It did so after the team evaluated several options to secure their future as a team.
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At the end of the year, the McLaren Group announced that it had signed a contract with MSP Sports Capital, a US sports investment group. It was done in order to continue its growth as a global sports franchise. The transaction made MSP Sports Capital a minority shareholder in the team; McLaren remains majority shareholder. The company financed McLaren Racing with 185 million euros. This means that they have initially acquired 15% of the shares, which will increase to 33% by the end of 2022.
Formula 1 F1 – Austrian Grand Prix – Red Bull Ring, Spielberg, Styria, Austria – July 3, 2021 McLarens Daniel Ricciardo in action in qualifying REUTERS / Leonhard Foeger
With Saudi’s stake in the McLaren Group, there could now be ever more connections between the company and the Middle Eastern country. Nonetheless, the immediate financial benefits to McLaren should definitely not be overlooked.
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