Middle Eastern Gov’t Takeover Plan
It appears that British business corporation McLaren is in the process of being bought out by Mumtalakat, a national wealth fund completely owned by Bahrain’s government. This comes after Mumtalakat already held a majority stake, now aiming for total ownership.
Sky News reports that a deal is close to being sealed between Mumtalakat and McLaren’s minority shareholders. Talks are underway for the equity of the latter to be converted into what is known as “warrant-like instruments,” granting them priority access to future investments, such as an initial public offering (IPO). The agreement has yet to be finalized, however.
According to a financial expert, Sky has asserted that a proclamation is likely to be made in the forthcoming days.
This agreement is expected to result in around 20% of the existing equity being transformed into the new contracts, enabling Mumtalakat to remain as McLaren’s only shareholder. Although McLaren Racing has external stakeholders due to the sale of a fraction of the team amid the pandemic to generate funds, these shareholders appear to be unaffected from this bargain with Bahrain.
In recent years, McLaren’s monetary situation has been fairly precarious. Despite this, their Formula 1 group has generally faired rather well as a middle-of-the-table team. Unfortunately in order to obtain the funds necessary, this has forced the company as a whole to turn to uncommon solutions. To that end, last year they made a decision to part with their venerated McLaren Technology Center for a sum of £200 million, although they carried on residing at the locale after concluding the agreement.
Amid numerous setbacks and reliability concerns precluding the implementation of the McLaren Artura, a portion of the firm’s Heritage Assortment of vintage race and street cars were put up for sale. Mumtalakat ultimately purchased them, yielding an approximate $123 million in revenue. Subsequently, not long ago, as part of its ongoing fund-raising efforts, McLaren was able to garner another $85 million. This is expected to bring the total funds raised to over sevenfold that value.
The brand is in an intriguing spot, as its present product portfolio, with the exception of the Artura, appears to have aged. The McLaren 750S is a moderate refurbishment of the 720S, and even the newly revealed McLaren GTS is little more than a cosmetic adjustment of the GT which has utilized similar advances to those seen in the 750S.
The Artura is the only one of its kind to boast real advancements, such as an updated electric infrastructure and recently installed V6 engine. We guess that plenty more products will arrive during the upcoming years – they all will be hybridized. As soon as laws governing emissions are put in place worldwide, it’s likely a fully-electric McLaren will come out too. Moreover, what’s being discussed is the construction of a four-door McLaren, which could be either an NCAA Taycan-style electric sedan or a Purosangue-eque SUV, with the latter option stronger given Michael Leiters’ former job at Ferrari while the Purosangue was formulated.
Rumors have been swirling in recent times that McLaren has been looking to collaborate with other automakers like BMW, but the uncertain funding scenario at McLaren apparently caused these opportunities to evaporate. However, now that solid ownership and financing are established, the British luxury car marque may become an interesting associate for some other Original Equipment Manufacturers (OEMs).
