F1 McLaren New Investors Announced
McLaren finished the turbulent 2020 Formula 1 season in 3rd place, achieving its best result since 2012. Leaving behind the troubled period with Honda, the team has continued to rise in recent years and with the results it achieved in the race on Sunday, it came third in the championship by passing Racing Point.
At the end of the same weekend, it was announced that a consortium led by the American investment company MSP Sports Capital purchased a 15% stake in McLaren for £ 185 million, and that rate could be increased to 33% by 2022.
This was big news for McLaren’s racing division as the general group had a rough year due to COVID.
So who are McLaren’s new investors, MSP Sports Capital?
The website of MSP Sports Capital, founded in 2019, includes the names of Jeff Moorad, Jahm Najafi, Arne Rees and Steve Wasserman. It is stated that the general purpose of this company is “professional sports teams, leagues and jobs pursuing ambitious and challenging tasks in the sports ecosystem”.
While the company is newer, the experience behind it is pretty much. Moorad started as a sportsman manager in the 1980s, and in the following years he took a very important place in the American sports industry. Moorad, who became a shareholder and CEO of the Arizona Diamondbacks baseball team in 2004, bought the San Diego Padres team in 2009. Three years later Padres was sold for over $ 800 million.
Jahm Najafi manages The Najafi Companies, which is part of the consortium involved in the deal, as well as being a partner of MSP Sports Capital. Najafi also has a rich investment experience both in and outside of sports. Najafi is also in the NBA, holding a significant stake in the Phoenix Suns basketball team.
Moorad had previously entered motorsport by taking the Hall of Fame Racing NASCAR team in 2007. Moorad worked with Tom Garfinkel, who is currently involved in the Miami Grand Prix project. Moorad met with McLaren Racing CEO Zak Brown, thanks to NASCAR. In this way, the foundation of today’s investment partnership was laid.
“I was invited to the race in Bahrain in March 2019 and attended as Mumtalakat’s guest. During a meeting, I was asked if I wanted to see Zak.”
“I knew Zak. We met him a few years ago when he had the NASCAR team. So I would be happy to meet with Zak again. To be honest, this is how the journey started.”
“When Zak was CEO of McLaren, he introduced Jahm and me to Sheikh Mohammed. It was pleased to meet him. We met him on another trip to Bahrain and several times in London.”
“Then when Paul Walsh came to the (chairman of the board), Zak suggested that Jahm and I meet with Paul.”
“We had conference talks a little with Paul, more with Zak. We were determined to have a partnership between the parties. At that point we started to imagine what we could do together.” said.
MSP Sports Capital has been interested in F1 entry for a while. Moorad had been in negotiations to buy the team when Force India was trustee in 2018.
“To be honest, it was a good training for us in terms of getting to know the sport,” Moorad said.
“We were also looking at Williams, albeit not so seriously. But given the point where things are coming, we couldn’t be happier than that.”
“As soon as our talks with Paul and Zak started, we didn’t look back. This was the team we were interested in.”
“If we had a relationship and a way to partner with McLaren, our first choice would be McLaren. So we are very pleased.” said.
For McLaren and Brown, this investment eventually came at a time when the stars were enlightened for the Woking-based team. Next year, the Mercedes power unit will be switched, the budget will be limited, and with investments in the new wind tunnel, McLaren may once again get ahead in F1. Everything is getting on track, albeit slowly.
“If you look at what Liberty does with income distribution, management style, technical rules, and most importantly, budget limits, then we now have a business plan, a trajectory where we can finally make a profit,” Brown said.
“Before the budget limit, this scenario was unattainable. Now we have a plan that can make us stand out again. I hope we will be able to return to the top rung of the podium, thanks to the plan we can finally make profit.
Since Liberty Media’s acquisition of F1 in January 2017, one of its main goals, led by Greg Maffei and Chase Carey, has been to increase the value of the teams and make them attractive for investment opportunities. Brown said that MSP’s investment in them is proof that this plan is working.
“F1 was a place where those who could spend the most and could afford to lose the most economically. This was not the most attractive dealership model at the end of the day,” Brown said.
“If you look at the values of NBA teams, Premier League teams and Major Basketball League teams, they have made huge improvements for their shareholders. When Liberty bought F1, he saw an opportunity that racing teams could create franchise value for investors like MSP.”
“The arrival of MSP in sports by investing in McLaren proves the veracity of Chase’s business plan, Greg’s investment plan. Today we see that where they position sport for the future is right.” said.
This was an endorsement for both F1 and McLaren. In MSP Sports Capital’s work ethic, emphasis is placed on the right people working in the right place and working together as a network. For Najafi, McLaren provided an important opportunity to take advantage of the people already available.
“In my 35-year investment career, I rarely found the right people working in the right teams and in the right leagues,” Najafi said.
“That’s exactly how McLaren Racing is. They are Greg, Chase and Stefano’s overall guidance in F1 and they have an overall vision for F1 that they want to achieve in the future. McLaren himself is a team of great people we really believe in, with Paul, Zak and Andreas. . “
“It is so rare to find the right people when trying to become partners that we had no choice but to make sure we made this investment and partnered with them.”
“This is a very exciting development for us. We believe in the overall vision Zak has in the team and we are excited to support his overall strategy so that the team can continue to be competitive and become champion in a very short time.” said.
McLaren to continue with “multifocal” F1 young driver program
McLaren stated that they will not deviate from the F1 young driver program, which is in no way “very focused”, and stated that they do not want to have the problem of transferring their skills to sports.
Since Sergio Sette Camara left at the beginning of the year as a reserve driver for Red Bull, McLaren currently has no drivers in the lower leagues.
But McLaren CEO Zak Brown stated that having fewer young drivers is the right point of view because there will always be outside attention, like Daniel Ricciardo, who will come to the team in 2021.
Brown: “We have a different philosophy.”
“I think after a while you run into the problem others have; Because you have too many drivers, you are trying to put them in other teams or there is no idle seat when the driver is ready. ”
“Especially with our recent progress, McLaren will always be a team with a strong desire for drivers to drive; especially as long as we continue our development. “
“Lando is very young. We’re just getting started with Daniel, so in 1 or 2 years we won’t have room for a driver to steal our paper. “
“I think we are more strategic, as in Lando; we found him early, like Stoffel (Vandoorne) – unfortunately it didn’t happen with him. It was with Lewis, and we picked a few drivers we thought would mature with a time to become seats. “
McLaren’s approach is diametrically opposite to that of Ferrari and Red Bull. The other 2 teams have many drivers in their programs, but often find it difficult to find seats for them.
Brown also said that McLaren is not a name interested in the young driver program, adding that F1 team boss Andreas Seidl and race director Andrea Stella closely follow the rising talent in the sub-series.