Ron Den­nis set to leave top McLaren job

F1 Racing - - F1 INSIDER -

Share­holder friction could re­sult in the man who re-made the team in his own im­age mov­ing on to pas­tures new

Ron Den­nis’s lat­est stint at the helm of McLaren looks to be com­ing to an end, fol­low­ing a de­ci­sion by his fel­low share­hold­ers not to ex­tend his con­tract be­yond the end of 2016.

The move comes af­ter a tense few years in the re­la­tion­ship be­tween Den­nis, who owns 25 per cent of the McLaren Group, and long-time busi­ness part­ner Man­sour Oj­jeh, also a 25 per cent share­holder. Mum­ta­lakat, the in­vest­ment arm of the King­dom of Bahrain, usu­ally rep­re­sented by Prince Sal­man bin Ha­mad bin Isa Al-Khal­ifa, own the re­main­ing 50 per cent and are sid­ing with Oj­jeh.

Den­nis, 69, will be pulling out all the stops be­tween now and the end of De­cem­ber to try to sal­vage his po­si­tion. He has al­ready told friends and as­so­ci­ates that he alone will make the de­ci­sion as to whether or not he steps down. But there is lit­tle he can do. He would re­main a 25 per cent share­holder, but un­less the Bahrai­nis and Oj­jeh sud­denly change their minds, he is very un­likely to have any ac­tive role or power in run­ning the com­pany.

McLaren said in a state­ment that Den­nis was “not step­ping down”. But this does not pre­clude him be­ing re­moved in some other way.

Den­nis has found him­self in this po­si­tion due to con­cern over the health of McLaren, as well as the de­te­ri­o­ra­tion in his re­la­tion­ship with Oj­jeh for both per­sonal and pro­fes­sional rea­sons.

Chief among the con­cerns about McLaren’s well­be­ing, is the fact that the team have lacked a ti­tle spon­sor ever since mo­bile phone gi­ant Voda­fone with­drew at the end of 2013, de­spite Den­nis an­nounc­ing in the March of that year that a new ti­tle spon­sor would be in place by the end of that sea­son.

Other losses have been mit­i­gated by new deals: lux­ury watch maker TAG Heuer, who moved to Red Bull, were re­placed by Richard Mille, while Boss cloth­ing, lost to Mercedes, have been re­placed by Michael Kors. Long-time fuel and oil part­ner Exxon Mo­bil, who are departing to join Red Bull next year, will be re­placed by a new BP/Cas­trol deal.

Even so, the McLaren F1 team have be­come in­creas­ingly re­liant on sup­port from en­gine part­ner Honda, fund­ing from whom amounted to a net an­nual in­crease in rev­enue of $100m for McLaren, com­pared with their pre­vi­ous Mercedes cus­tomer deal. There is cur­rently no sign of any ma­jor new backer on the hori­zon.

Den­nis has, for some years, been try­ing to raise the nec­es­sary funds to buy suf­fi­cient shares from Oj­jeh and Mum­ta­lakat to take a con­trol­ling share­hold­ing in McLaren. Sources in­side McLaren say he has ac­tu­ally sourced fund­ing from two sep­a­rate Chi­nese con­sor­tiums. One was all set to go be­fore a down­turn in the Chi­nese econ­omy caused the deal to col­lapse. Another is still in place, but Oj­jeh and the Bahrai­nis have de­cided they do not want to sell, ac­cord­ing to se­nior in­sid­ers, be­cause they do not want to grant Den­nis any more con­trol. A num­ber of names have been men­tioned as pos­si­ble re­place­ments for Den­nis. McLaren have con­tacted for­mer Mercedes F1 boss Ross Brawn, although he is now set to take a role as CEO (Sport­ing) of the new For­mula One Group. McLaren’s own for­mer team prin­ci­pal Martin Whit­marsh has also been ap­proached, as has the for­mer head of Sains­bury’s, Justin King. Lead­ing F1 mar­ket­ing ex­pert Zak Brown, who has been linked with a com­mer­cial role at the For­mula One Group, has also emerged as a can­di­date.

Whit­marsh and King are con­sid­ered un­likely to take the role, while Brawn re­cently told

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