F1 Talk: Force India saved after entering administration

This week’s major story from the Formula One world is that Force India has been saved and a bid has been accepted by the administrator.

It was confirmed on Tuesday that a consortium, led by Lawrence Stroll (father of Williams driver Lance Stroll), had been assembled with the assistance of Force India’s chief operations officer Otmar Szafnauer and the team’s senior management.

Force India’s creditors will be paid in full, all 405 jobs at the team have been saved and ongoing funding has been guaranteed. Great news for the team after 12 months or so of trying to find a buyer.

The consortium takes over ownership of the team from Vijay Mallya and Orange India Holdings Sarl.

No matter how much you may dislike the Strolls’ and how this move is now likely to give Lance a Force India drive next season, the good news is that the team is saved after some people feared the worst. Formula 1 could not afford 18 cars on the grid at Spa.

Now that a bid has been accepted the administrator will look to confirm finer details. This will include finalising the agreement to buy the team and agree elements like the contract to use Mercedes engines transferring to the new company. It’s not all over yet but the main chunk of the bid is done.

Force India owes money to several creditors such as Sergio Perez and Mercedes who used the money he was owed to trigger the initial action that led the team to being put into administration at the request of senior members of the team.

The injection of £30 million from Rich Energy before Force India were taken into High Court was, to me, a last ditch effort by Vijay Mallya to keep control of the team.

It is a good thing that it didn’t work though because take a look at Force India’s losses between 2010-2016, before taxation as well.

• 2016: £23m
• 2015: £19m
• 2014: £27m
• 2013: £49m
• 2012: £39m
• 2011: £36m
• 2010: £26m

The numbers tell the story and it’s not exactly great for a team that has punched above its own weight for several years.

It’s excellent news that Force India are on there way to a genuine recovery as they now have a consortium which includes successful businessman, many of whom are motorsport enthusiasts. Advertising and publicity for the team may not be as much of a problem anymore and more importantly the budget for the team should increase.

As well as Lawrence Stroll, this is the rest of the consortium:

• Andre Desmarais, president of Power Corporation
• Jonathan Dudman, of Monaco Sports and Management
• John Idol, head of the Michael Kors brand
• John McCaw Jr, investor
• Michael de Picciotto, financial expert
• Silas Chou, an associate of Stroll

The move is likely to put Lance Stroll in the car from next season which means that Perez or Ocon will have to move teams. Who goes? It really is a 50/50 call.

But, Perez, BWT and Mercedes were the ones instigated this move, could this also mean BWT and Perez could move to Williams? Martini will be gone next year and there’s the fact that Mercedes wants to make Williams a Merc B Team.

If Mercedes have a lot of power then they could even get Ocon and Perez at Williams. This would be good news for Williams and if you look at how well Ferrari’s customer teams are currently doing then it could be a brilliant move. For Toto Wolff, a  B-team he effectively controls through a bid that he supported would have considerable added value.

So many questions will be asked but there is now light in the tunnel. Upgrades can now come and Force India can hopefully fight with teams who have much bigger budgets. Money shouldn’t be a problem now and the team can focus on the on track action.

To me it seems the administration was a shrewd move to be able to acquire the team from a court appointed administrator after any eventual talks with the team owners didn’t go anywhere. It’s all worked out though and F1 should be relived that Force India won’t follow the likes of Manor or Caterham in the recent past.