Bahrain Gains Full Control of McLaren Group in Deal With Minority Investors

Bahrain Gains Full Control of McLaren Group in Deal With Minority Investors

Bahrain’s sovereign wealth fund is gaining full ownership of McLaren Group, one of the most revered names in British premium manufacturing, as part of long-term plans to secure a partnership with a global industry giant.

Mumtalakat, the Gulf state’s investment fund, is on the brink of a deal with McLaren’s remaining minority shareholders to convert their equity into warrant-like instruments.

The new contracts will have the economic rights to benefit from a future ‘liquidity event’ such as an initial public offering of McLaren but will not be classified as shares.

One banking source said they expected the agreement to be announced later this week.

It would involve roughly 20% of the equity in McLaren being converted into the new contracts and leave the state of Bahrain as the Formula One team-owning group’s sole shareholder.

McLaren Racing, the division that directly houses the F1 and other racing operations, does have its own external shareholders following a deal struck during the pandemic to raise capital.

The deal to be signed this week underlines the continued confidence and leadership of Mumtalakat in driving McLaren’s turnaround, according to one insider.

The Woking-based company’s convoluted capital structure has acted as a deterrent to global automotive groups’ ability to structure a long-term partnership