Whispers that Force India have a ‘concrete offer’ on the table to sell
Whispers last week
TJ13 reported earlier in the week that Mallya and Sahara could be in negotiations to sell part of all of the Force India Team. And raise much needed cash.
“I was chatting to someone this weekend who is both experienced and wise in the matters of team operations, and I told him of my increasing surprise at Force India’s lack of announcement of Di Resta. He smiled and said he was not. I pressed him on the matter insisting there is absolutely no reason not to announce a driver who will definitely be racing in 2013.”
He asked me one question. “When football clubs may be about to change owners or managers, do they announce new player contracts or leave those decisions for those about to take responsibility?” (TJ13 Link)
A source close to the Force India team told TJ13 today that there had been a recent and prominent lack of basic stock items available which was causing concern.
Further, this morning runours have it that in a strange turn of the circle, Mr. Bernie Ecclestone is looking at a rescue plan for the Silverstone team. Ironically, it was his failure to run a successful F1 team in the late 1980’s that opened the doors for him to run F1’s commercial affairs – making him a multi billionaire. He sold the Brabham team for a reported $5m in 1988.
Mr. Ecclestone was allegedly one of a number of the interested parties negotiating to buy Brawn GP for the 2010 season. Some suggest he was outbid and beaten to the deal by Daimler-Benz, a matter he was reportedly most displeased about and which may goe someway to explain the reported animosity between the two parties early in 2012.
The return Kolles and Di Resta out?
Further, ItaliaRacing.net is reporting that Colin Kolles, who they suggest is a favourite with Ecclestone due to his ‘hard headed’ approach to team organisation, may be making a return to the Silverstone team he previously managed as Jordan, Midland, Spyker and then Force India until in 2009 Vijay Mallya decided to replace him – with himself.
The Italian site suggests Mr. Ecclestone may enlist the help of Flavio Briatore in the bid to save the Force India team .
F1 fans have lit up the world wide web with their debates and discussions as to why Paul Di Resta has not been confirmed as one of the Force India team’s drivers for 2013. However, should Mr. Ecclestone acquire the Silverstone based team, it is possible the young Scott would not be given a drive this year.
Problems for Ecclestone
If Ecclestone were to acquire an interest and influence in an F1 team, what could this mean? As CEO for the owner’s of F1 (CVC), Bernie has an eye to the big business that is the race promoters’ fees that generate nearly half of F1’s annual revenue. The Indian GP saw a pretty spectacular fall in attendance in the second year of hosting an F1 race (2012). At the time, Mr. Ecclestone expressed concern that with no Indian F1 driver in the future, these attendances could fall further. He was on more than one occasion in TV interviews seen to be cajoling Vijay Mallya to recruit an Indian driver to his Force India team.
There has been a fair amount of criticism of Ecclestone recently, led by the president of Ferrari, who questioned whether the F1 supremo’s age mitigates against his ability to juggle the many balls required to manage F1. This has been evident in the chaos of the F1 2013 calendar.
Ecclestone has made copious ‘announcements’ on the matter fostering speculation around where the 20th race would be held that replaced the cancelled New Jersey event. 2 circuits in France, Austria and Turkey have all been debated.
The most amusing of these fau pas was when asked about the likely country to host the empty date on the provisional calendar – he replied “France – it will be France”. That date was the same day as Le Mans!
Why FOM might want a racing team
With his eye on the future circuits coming on stream, it could be is important for Ecclestone to deliver these to the calendar particularly as the rumblings over finance with a number of traditional F1 venues continues. Valencia have dropped out, Germany don’t know who is going to host the race in around 6 months yet and the Turkish government refused the F1 hosting deal of the decade at a mere 10m euro’s.
To this end Russia is the next flag-ship ‘guaranteed’ entrant to the F1 circuit and Ecclestone is known to be very keen to have a Russian driver on the grid. Should he and commercial rights holders CVC control an F1 team like Force India it would enable FOM (the owners’ operating company) to promote F1 to the Indian and Russian fans by offering a national icon they can connect with – say Narain Karthikeyan and Vitaly Petrov.
It is likely there would be criticism from within the sport about potential conflicts of interest, yet the regulations at present do not appear to preclude this relationship between FOM and a competing F1 team.
(Since this story was posted the ItalianRacing.net article was offline for a couple of hours but is now back – if you tried the link and it didn’t work, it does now)
UPDATE 16:00 GMT: Force India have told Autosport this afternoon, “Our shareholder Vijay and Sahara are incredibly strong. “They don’t need partners. As we speak, we are putting together and implementing an expansion programme that Vijay talked about at the end of last year,” he said in regard to a £50 million investment in the team’s facilities.”
And all that is going ahead and moving forward. For the last four years, coming now to our fifth year, the team has been financed without any dependence on the shareholders’ companies that they own. There is absolutely no substance to it anywhere and that’s the thing that’s very distressing.”
“We have had no discussions whatsoever with any buyers at all.”
SAHARA Force India have listed on their site as partners (read sponsors) – Whyte and MacKay, Vladivar (owned by W&M), Royal Challenge (an Indian whisky owned by United Spirits), UB Group, Kingfisher and Fly Kingfisher listed as official partners. (LINK) Including Sahara this is 7 of the 21 ‘partners’ who are ‘shareholders’ companies’. Wonder what the balance of contribution is?
On the home page of Force India’s website, the six above ‘partner’s along with Pirelli are in big boxes, and the others in boxes about a third of the size underneath.
The Silverstone team have also said that they will not use the launch to ‘confirm their driver lineup. ”No. The launch is to launch the VJ06,” said Bob Fearnley. He did however suggest it was unlikely they would use testing to evaluate possible candidates. In the words of Lewis Carol, “curiouser and curioiser….”.
Update: 16:48 GMT: Within the past hour, German media source MotorSport-Total.com claims they have information that there is a concrete offer on the table to buy Force India, and it is awaiting a response from Vijay Mallya and his co-investors.
In the meantime Kingfisher Airlines will appear in court on Monday, as they request to defer taxes due to the Indian authorities as it will cause “irrepreable damage and harm” to the company if they are forced to pay them now. (Economic Times). Not much chance of that ‘partner’ sending a cheque then.