Bahrain and Abu Dhabi Funds Acquire Full Control of McLaren Racing

Bahrain’s sovereign wealth fund, Mumtalakat, and CYVN Holdings of Abu Dhabi have completed a significant acquisition, gaining full ownership of McLaren Racing. This transaction took place on October 3, 2023, and media reports suggest the deal values the reigning Formula One champions at over $4 billion.

The agreement entails the purchase of all shares previously held by MSP Sports Capital, along with funds managed by O’Connor Capital Solutions, Ares Sports, Media and Entertainment funds, and Caspian Funds. Although McLaren Group did not disclose specific financial details, earlier reports from Sky News indicated that the sale of a 30 percent stake would value McLaren at approximately £3 billion (around $4.05 billion).

Mumtalakat will maintain its position as the majority shareholder, while CYVN Holdings, which is primarily owned by the government of Abu Dhabi, will hold a non-controlling stake. Notably, CYVN established McLaren Group Holdings in April 2023 after acquiring McLaren Automotive.

McLaren Racing operates teams in Formula One and U.S.-based IndyCars, with plans to enter the World Endurance Championship in 2027. The investment group MSP and other partners originally took a significant minority stake in 2020, during a crucial time for McLaren, which was struggling financially due to the impact of the COVID-19 pandemic. The initial investment, which allowed for a maximum 33 percent stake by 2022, valued McLaren at £560 million at that time.

Since then, McLaren has transformed its performance, winning the constructors’ title in 2022 for the first time since 1998 and currently aiming for both titles in the ongoing season. Paul Walsh, Executive Chairman of McLaren Group, expressed gratitude towards the minority investors who supported the team during its financial recovery.

“Our suite of minority investors came on board in 2020, and we thank them for their tremendous support over the past few years as we set McLaren Racing on a path to commercial growth and financial stability,” Walsh stated. He emphasized that the simplified ownership structure will enhance the company’s ability to “future-proof the business and capture new growth opportunities.”

As part of this transition, Jeff Moorad, CEO of MSP Sports Capital, and Jahm Najafi, chairman, will step down from their positions on the McLaren Racing board. Ares Management indicated that the proceeds from this transaction will be utilized to return capital to investors and reinforce its role as a seasoned investor within the sports sector.

This acquisition marks a pivotal moment for McLaren Racing, solidifying its financial foundation as it continues to compete at the highest levels of motorsport.