Saudi's PIF in talks to buy stake in McLaren Group

Saudi's PIF in talks to buy stake in McLaren Group
2 min read
16 July, 2021
Saudi Arabia's Public Investment Fund (PIF) and global investment firm Ares Management are in advanced talks to take a 400 million pound ($553 million) stake in the McLaren Group.
The deal is under works [Getty]

Saudi Arabia's Public Investment Fund (PIF) and global investment firm Ares Management are in advanced talks to take a 400 million pound ($553 million) stake in the McLaren Group, Sky News reported on Friday.

There was no comment from McLaren and PIF was not immediately available for comment.

McLaren Group includes the British supercar maker as well as McLaren Racing, which competes in Formula One and IndyCar in the United States and is also entering the Extreme E off-road electric series next year.

Sky cited banking sources and said McLaren was set to announce a 550 million pound equity raise, with 400 million of new capital from PIF and Ares and the rest from existing shareholders.

Bahrain's Mumtalakat sovereign investment fund is McLaren's majority shareholder with a 62.55% stake according to its website. Mumtalakat did not respond to a request for comment.

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McLaren had a 300 million pound equity injection from existing shareholders in March 2020 and last April completed a 170 million pound sale and leaseback deal on its Woking headquarters.

U.S.-based investment group MSP Sports Capital also acquired a significant minority stake in McLaren Racing last December in a deal that brought in 185 million pounds.

Automotive revenues in the first quarter of this year were 170.5 million pounds, a rise of 145% on the same pandemic-affected period in 2020.

PIF were involved in a proposed takeover of Premier League soccer side Newcastle United by a Saudi Arabian-backed consortium last year.

That deal ultimately collapsed after being delayed by the Premier League's owners and directors test.