In the past year we have met, chatted to and interacted with so many interesting people due to this blog. Overall, it’s is mainly a positive experience but we must admit at times it is like hitting your head off a brick wall. This has been one of those weeks.
Manor Racing Fan Blog has for the past three weeks been reporting that a bid for the team was being made by an Asian investment fund – CGF. We have been provided with evidence from a strong source close to the deal.
As a fan of the team and more importantly as someone who is aware that every blog posted is read by Manor employees who have just lost their jobs, I would never dare publish anything that was not backed up by strong evidence.
No other outlet has this information and we were passed it on in good faith. There are lots we simply cannot publish but when the whole story comes out it will surprise people what exactly went on in the last few months of the team.
I will admit to being very frustrated when some have brought into question the credibility of my reporting. It has also been quite demoralising getting tweeted the same things that I have already previously addressed so I have taken the time to give longer answers to some of the questions I get on a daily basis. Within that section there is some new information that has come my way since the last blog.
However, please note, unless you are an experienced Fund Manager with a proven record in acquiring failing businesses, I am not that interested in your opinion on this process.
Maybe you are a legal eagle who is knowledgeable about the processes of purchasing a company in administration.
Or perhaps you have insider information closer to the ground floor than we do and can provide a day-to-day update on this situation. Maybe you even know someone else with tens of millions of pounds who is willing to buy a business that has a record of financial failure, a host of potential liabilities and debt, which operates in a field that is currently undergoing a huge transition.
If not, then I am still not interested in your opinions.
Now I’ve got that off my chest. Feel free to tweet me anything you wish clarified from the below but keep it on topic, rational and limit your topic of interest to something you know about. Please!
“I heard that the deal needed to be completed by the 10th of February otherwise it was dead.”
Answer: We are a few days late here but it was wrong then and its certainly wrong now. To be fair to the original source he is normally spot on on most things F1 related and one of the very few journalists who seems to know something is going on. However, this is his third stab at this story and has got nowhere near the truth yet. He even got the name of the investment company wrong at the first attempt which I have been assured made them all chuckle.
I do believe that he wrote it in good faith and had a credible source but it has been a big surprise to me who knows what at the moment.
“The deal has been the table for months”
Answer: Not true. Once Manor went into administration on the 6th of January it killed any other bid stone dead. The whole process had to start again and go through legal procedures required for purchasing a company in administration.
The company going into administration complicated the liabilities held against the team and given the team’s history of financial issues and outstanding debts, the whole bid had to re-evaluated.
“CGF are not serious, they should show us the money.”
Answer: Anyone who spends a few minutes on google can find out the sort of assets that CGF have. Buying a F1 team is a drop in the ocean to them. There are also a lot more safer and less public ways of investing money than buying a F1 team. The purchase would be part of a longer term strategy that will continue with or without the purchase of a F1 team.
“Hopefully CGF will step aside when a real buyer turns up”
Answer: There are no other bidders. If this bid fails, it’s curtains for the team. I’ve been told this in no uncertain terms from both the Manor and the CGF side.
“They are taking too long”
Answer: As things stand, CGF are actually way ahead of where Stephen Fitzpatrick was when he purchased the team in 2015. The team went into administration on the 6th of January so the process is just over a month long. In that time they had to ensure that all the investors wished to pursue the bid, and then await closure on a vast and costly due diligence process.
All of this happening in the middle of Chinese New Year did not help the process as the required lawyers meetings and contracts to be looked at were delayed. CGF is a multi-national company so being in several different timezones and waiting for information coming out of each area has also hampered the bid.
There is a reason they are such a wealthy company. Even if buying an F1 team is a drop in the ocean to them, they are not in the habit of wasting investors money on a vanity project. Every conceivable angle of this deal must be covered before it gets the sign off.
“Manor can just skip Melbourne.”
Answer: It is CGF’s understanding that that is not the case and if they at any point in the negotiations believe they won’t make the start of the season – the deal will be dead.
The information given to us is that CGF believe that they will not get the discretion required from the other teams to miss races, thus it will be argued that they did not meet their minimum obligations, which in turn will effect TV money payments.
“Will Manor have to run the 2016 car for the 2017 season?”
Answer: Not our specialist area so we asked a team mechanic on their opinion and they have stated that if there was the right financial backing, it could be possible to turn up in Melbourne with an all new car.
We understand that the staff remaining at Banbury are in direct contact with suppliers to ensure the car could still be built in time if the bid goes through. A big hello to those guys btw 😉
“Do you think the bid will succeed?”
I honestly don’t know. It is on a knife edge right now. My gut feeling is no.
There has been a lot more going on behind the scenes that is making it very difficult to get the deal over the line. Once one hurdle is cleared another big one pops up. I am praying for the sake of all the staff who have been let go back in Banbury that something positive comes out in the next few days/weeks.