Market Reports, News

BAHRAIN’S sovereign wealth fund has bought sports-car maker McLaren after this month increasing its holding to 100 per cent from 60 per cent.

McLaren termed it as a “major milestone” that ends a long period of financial uncertainty for the company that has been recording heavy losses. 

The fund, Mumtalakat, has been an investor in McLaren Group since 2007, when it bought a 30 per cent stake from founding shareholders Ron Dennis and Mansour Ojjeh.

It increased that stake to 60 per cent through injecting hundreds of millions of dollars into the business.

In its report, the BBC said that the fund’s decision to take full control, which was initially agreed last year, bolsters McLaren’s finances in the short term.

The company is now understood to be looking at technical partnerships with other businesses, to help it develop electric vehicle technology.

“We are delighted at Mumtalakat’s continued commitment to McLaren through this deal,” McLaren Group’s executive chairman Paul Walsh said in a statement.

“This will further enable us to focus on delivering our long-term business plan, including investment in new products and technologies, while continuing to explore potential technical partnerships with industry partners.”

The business has been under financial strain since the COVID pandemic, which initially forced it to suspend production of cars and then led to the cancellation of its motorsports activities.

It underwent a major restructuring in 2020, which included the loss of more than 1000 jobs.

It was then affected by the widespread disruption to supply chains that occurred as economies got back into gear following the pandemic, in particular a shortage of computer chips.

There were also problems with its new Artura hybrid sports car, which caused it to suspend production and led to delays in deliveries.

In the first nine months of last year – the most recent period for which figures are available – it made a pre-tax loss of £276 million ($A533.7m).

The Bahraini fund was not the only suitor. The BBC report said that Polestar, owned by the Chinese group Geely, was having talks with McLaren.

The Financial Times had earlier said that discussions had also been held with Hyundai, BMW and Californian electric brand Lucid Motors.

The McLaren Group has its headquarters in the Surrey town of Woking.

It owns McLaren Automotive, which over the past 14 years has become a major player in the market for prestige sports cars where it competes with other top-shelf brands including Ferrari and Porsche.

The group also has a majority stake in McLaren Racing, which owns the McLaren Formula 1 team, and also competes in the US IndyCar series, and the electric series Formula E and Extreme E.

It launched the GTS model in December and the Artura Spider, McLaren’s first series-production high-performance hybrid open-top supercar.

In Australia earlier this year it launched the 750S coupe ($585,800) and 750S Spider ($654,600).

By Neil Dowling

AdTorque Edge