Formula 1

McLaren’s New Era: Bahrain’s Mumtalakat Takes Sole Ownership

The McLaren Group is set to be owned entirely by Bahrain’s Mumtalakat, in a strategic move marking a pivotal moment for the company. This decision aligns with McLaren’s long-term goals and sets a new trajectory for the group.

Key Takeaways:

  • Ownership Shift: Bahrain’s sovereign wealth fund, Mumtalakat, will soon become the sole owner of the McLaren Group, a significant change in the company’s ownership structure. This transition involves the conversion of minority shareholders’ equity into contracts, allowing them economic rights without share classification.
  • McLaren’s Strategic Direction: The recapitalization and sole ownership by Mumtalakat reflect a strategic shift for McLaren. This move could pave the way for technological partnerships in the automotive sector, especially in hybrid and electric vehicle development.
  • Recent Financial Moves: Mumtalakat’s increasing influence in McLaren is evident from its recent acquisition of shares from Saudi Arabia’s sovereign wealth fund and Ares Management, as well as an additional investment of £80 million into the company.

The McLaren Group, a renowned name in the world of Formula One, is undergoing a significant transformation. Bahrain’s sovereign wealth fund, Mumtalakat, is set to become the new owner of the group, a move that signifies a major shift in the company’s trajectory. This transition is part of a long-term strategic initiative, aiming to establish a strong partnership with a global industry leader.

The forthcoming deal will see the remaining minority shareholders of McLaren convert their equity into contracts. These contracts, as reported by Sky Sports, provide the economic benefits of future events like an initial public offering of McLaren, without being classified as shares. This arrangement indicates a novel approach to corporate ownership and investment strategy.

The state of Bahrain, through Mumtalakat, will thereby hold full ownership of McLaren, impacting the Formula 1 team-owning group significantly. Currently, Mumtalakat holds about 60% of the McLaren Group, and its decision to acquire the remaining shares is a strong vote of confidence in McLaren’s future.

Moreover, McLaren Racing, a subsidiary that includes Formula 1, IndyCar, Extreme E, and Formula E operations, has external shareholders. This new ownership structure may offer opportunities for technological collaborations, especially as McLaren shifts focus towards hybrid and electric vehicles.

The move follows Mumtalakat’s recent financial actions, including acquiring shares from Saudi Arabia’s sovereign wealth fund and Ares Management, as well as injecting £80 million into McLaren. These steps underline Mumtalakat’s commitment to McLaren’s growth and innovation.

The Group’s Executive Chairman, Paul Walsh, emphasized the importance of this recapitalization, stating on the official website, “Completing the recapitalisation is a significant step in the ongoing transformation of the Group and provides a solid platform from which to grow our product offering and brand presence.”

H.E. Shaikh Abdulla bin Khalifa Al Khalifa, the majority shareholder of the Group and CEO of Bahrain Mumtalakat Holding Company, further added, “Today’s announcement is testament to the diligent steps that have been taken in what is a comprehensive and long-term plan with our partners to deliver an optimal governance structure as the Group continues to design and deliver the world’s most innovative and exhilarating supercars.”

This strategic ownership change marks a new chapter for McLaren, potentially influencing its direction in the competitive world of Formula 1 and beyond, as it navigates the evolving landscape of the automotive industry.

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