Lotus ready for pole position
Loss-making F1 team is rumoured to have a new investor, reports Mark Leftly
Mark Leftly is political correspondent at The Independent on Sunday and associate business editor across the Independent titles. He writes a weekly column, Parliamentary Business, published on a Wednesday, that covers politics and the City. He is a multi-award winning reporter and was named Press Gazette's business magazine journalist of the year prior to joining The Independent on Sunday.
Sunday 09 June 2013
Asense of crisis has enveloped the Lotus Formula One team. If it isn't one of motorsport's biggest-ever financial losses – £56.8m, post-tax, in 2012 – then it's losing two finance directors, Phil Thompson and Nigel Newton, in the space a couple of months.
Life in the pit lane isn't much rosier. Top driver Kimi Raikkonen has caused a stir by suggesting that someone should punch McLaren rival Sergio Perez "in the face", while the flying Finn's colleague, Romain Grosjean, languishes in ninth place in the World Championship standings.
There was also confusion over whether or not property magnate Andrew Ruhan had purchased a stake in the Oxfordshire team. Denied shortly after he joined the board earlier this year, it then turned out Ruhan had taken 2 per cent for about £1m.
Ruhan hit the headlines recently as he is being sued for up to £250m by former business associates who claim that he should have given them a share of the sale of three Thistle hotels. He is fighting the allegations and the case is due to go to court next year.
But The Independent on Sunday understands that Lotus F1 owner Genii Capital is close to a major financial announcement, thought to be the sale of a huge chunk of the team. Three parties are looking at taking a large minority stake.
The situation is clouded by the team's links to the Lotus Group, which has a complicated ownership structure and seemingly ever-changing ties to the F1 team.
Although Lotus F1 carries the luxury car manufacturer's brand, the group does not currently have a stake in the team.
Until last year Lotus sponsored the team and its own owner, Malaysian automobile manufacturer Proton, had the option to take a 50 per cent stake from Genii. However, this option was removed in 2012 when Proton ended the sponsorship deal and instead loaned the team an estimated £35m. This came around the time that Proton itself changed hands and control switched to conglomerate DRB-Hicom.
A Formula One source says that a fresh investor could benefit should Lotus complete a strong season this year.
He argues: "I suppose it's not that surprising given that they've already sold a couple of per cent to Ruhan.
"Lotus finished fourth in the constructors' championship last year and the payment for that is good, and [Raikkonen] is doing pretty well at the moment."
What is for sure is that news of a cash injection would be welcome for a team that has had its financial problems in recent years.
Even forgetting last year's travails, the 2010 post-tax loss was £34.2m and a year later the team was still £20.8m in the red.
Loses or not, F1 is still glamorous enough to grab the big money.
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