Williams considers sale of Formula One team

Pandemic adds to strain after poor performance on the track and £17m loss

The owner of the Williams Formula One racing team is considering a sale as part of a wider strategic review, following disappointing performances on the track, a £17m loss last year and as coronavirus adds to its woes.

Williams Grand Prix Holdings said on Friday that it was reviewing its options, which include an outright sale of the business, raising capital, selling a majority stake or seeking a minority shareholder.

The company said it had not received any offers but confirmed that it was in preliminary talks with “a small number of parties” over potential investment. Allen & Co and Lazard are advising Williams on the possible sale and a wider strategic review.

Williams has finished in last place for two consecutive seasons, straining the company’s finances even before the coronavirus pandemic. Founded in 1977, Williams has an illustrious history, having won the Constructors’ Championship nine times.

The group made a loss of £17m on continuing operations in 2019, before taking into account the sale of its advanced engineering business, swinging from a pre-tax profit of £4.1m in 2018. Revenue from continuing operations fell from £131.7m to £96.6m.

The team also said it had terminated its relationship with ROKiT, its title sponsor, and ROK Drinks. Nick Rose, chairman of Williams, said the “premature end” of the relationship was “unwelcome”, adding that the team would seek alternative sponsors.

“The financial results for 2019 reflect the recent decline in competitiveness of the F1 operation and the consequent reduction in commercial rights income,” said Mike O’Driscoll, chief executive of Williams.

The company said the pandemic would add to the pressure on revenues, while other team owners have said they would seek to cuts costs as they cope with the fallout from the crisis.

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McLaren Group, which also owns a racing team and sells supercars, fell to a £133m pre-tax loss in the first quarter. Renault, another F1 team owner, plans to cut 14,600 jobs across the wider group.

The pandemic has been the biggest test for F1, which is celebrating its 70th anniversary this year, since it was acquired by US group Liberty Media in an $8bn deal in 2017.

F1 is seeking to restart the season on July 5 in Vienna, and Williams said it was “funded and ready” to race. The pandemic has forced F1 to call off or postpone 10 races.

Lowering the cost of competing in F1 has become an even bigger priority in light of the pandemic, with budgets under further pressure. A cost cap for teams that is due to come into force in 2021 has been reduced from $175m to $145m to ease the burden on teams, though some had argued for a more dramatic fall.

Teams hope the cost cap could help them compete more effectively against the “big three” of Ferrari, Mercedes and Red Bull, which have dominated the podium in recent years.