Business: New McLaren Group acquires Ron Dennis’s shareholding and steps down as Chairman
Woking, Friday 30 JUNE 2017-
• Ron Dennis, Chairman of McLaren Technology Group and McLaren Automotive, has agreed terms to sell his shareholdings in both companies
• The formation of the McLaren Group – the new holding company of McLaren Technology Group and McLaren Automotive – will underpin the continuing rapid growth of McLaren’s businesses and brand
• The Bahrain Mumtalakat Holding Company and TAG Group will remain as majority McLaren Group shareholders
• Shaikh Mohammed bin Essa Al Khalifa will become McLaren Group’s Executive Chairman
• On completion of the transaction, Ron Dennis will step down as Chairman of both companies, and will continue to pursue his career as a consultant and entrepreneur
Ron Dennis CBE has reached agreement with his fellow shareholders in McLaren Technology Group and McLaren Automotive to sell his shareholding in both companies.
Ron celebrated his 70th birthday on June 1st 2017, after 37 years at the helm of McLaren, and 51 years spent working in Formula 1 and other top-level motorsport series.
During his 37 years at McLaren, Ron led the team to 158 Grand Prix wins and 17 Formula 1 World Championships, managing some of the greatest drivers in the history of motorsport (including Niki Lauda, Alain Prost, Ayrton Senna, Mika Hakkinen and Lewis Hamilton, who all won World Championships under Ron’s management) as well as the world-renowned Le Mans 24 Hours race in 1995.
In 2004 Ron announced the launch of McLaren Applied Technologies, which focuses on applying motorsport-bred innovations and technologies so as to improve the performance and product innovation of blue-chip companies in a wide variety of industries.
In 2010 Ron oversaw the formation of McLaren Automotive, now one of the world’s leading manufacturers of high-performance sports cars.
On December 18th 1980, Ron merged Team McLaren (as it was then known) with his own company, Project Four, to form McLaren International, then valued at £3 million. Fewer than 100 people were employed by the new company at that time. In the 37 years since then, supported by the investment of TAG Group in 1984, Ron has presided over a period of remarkable and prodigious growth. The McLaren Group is today valued at £2.4 billion, had a combined turnover in 2016 of £898 million, and now employs more than 3400 people.
Ron Dennis CBE said:
“I am very pleased to have reached agreement with my fellow McLaren shareholders. It represents a fitting end to my time at McLaren, and will enable me to focus on my other interests. I have always said that my 37 years at Woking should be considered as a chapter in the McLaren book, and I wish McLaren every success as it takes the story forward.
“Perhaps my greatest satisfaction is the Formula 1 team’s outstanding racing safety record, which is a tribute to the dedication and efforts of hundreds if not thousands of talented and conscientious employees whom I have had the privilege of leading.
“I will continue to consult for various companies and work with the UK Government’s Ministry of Defence Innovation Advisory Panel in helping to improve the technology, the culture and the organisations that together safeguard the UK’s national security.
“I will also continue to run my family’s charitable foundation – Dreamchasing – which focuses on mentoring and financing children and young people from all walks of life, so that they may aspire to and succeed in whatever their career dreams may be. It was working with Lewis Hamilton, whom I took under my wing when he was just 12 years old, and who became Formula 1 World Champion with McLaren in 2008, that inspired my idea to establish Dreamchasing as a charitable foundation.
“Now that my time at McLaren has come to an end, I will be able to involve myself in a series of other programmes and activities, especially those focused on public service. I will continue to indulge my passion for supporting contemporary artists and collecting their work, but most of all I will be driving new ideas and projects forward.
“Last but far from least, I wish McLaren well, and I send my greatest thanks and best wishes to my colleagues in all corners of its business, and at every level of seniority. Truly, they are the best of the best. And, well funded to succeed and grow, and led by an ambitious management team, McLaren is ideally poised to build on the successes that I am so proud to have contributed to during my time leading such a great British group of companies.”
Shaikh Mohammed bin Essa Al Khalifa (Executive Chairman and Executive Committee principal) said:
“I would like to pay tribute to Ron’s immense contribution to the McLaren success story over the past 37 years.
“As soon as he had taken over the running of the team in the late autumn of 1980, it was immediately clear that here was a man whose ambition to surpass the achievements of all previous Formula 1 team principals would not be checked. Together with Mansour Ojjeh of TAG Group, whom Ron soon introduced to McLaren and whose support has been invaluable to its success for a third of a century, Ron rewrote the record books in the 1980s and 1990s, winning Grands Prix and World Championships as a matter of apparent routine. But it was not routine: it was in fact the result of a lot of clever thinking and a huge amount of extremely hard work.
“That ethos remains at McLaren, and I am very proud now to be assuming the position of Executive Chairman, alongside Mansour, my fellow Executive Committee principal, who will continue to work with me to drive McLaren Group forward to new successes.
“There will be time in the near future to outline our plans, for the coming months and years will be an extremely exciting time in the story of McLaren. But now, today, it is appropriate that we pause to express our gratitude to Ron. So, on behalf of McLaren and all who sail in her, may I say three heartfelt words: thank you Ron.”
NEW McLAREN GROUP UNIFIES McLAREN AUTOMOTIVE AND McLAREN TECHNOLOGY
GROUP WITH ONE WINNING FUTURE
FRIDAY 30 JUNE 2017
• The formation of the new McLaren Group will underpin the continuing rapid growth of McLaren’s businesses and brand
• The new McLaren Group unites McLaren Automotive – a globally-renowned producer of luxury sports and supercars – with McLaren Technology Group which includes one of the world’s oldest and most successful race teams and a high growth technology IP and consulting business
• The Bahrain Mumtalakat Holding Company and the TAG Group will remain as the long-term majority shareholders of the new group and Shaikh Mohammed bin Essa Al Khalifa will become its Executive Chairman
• Mike Flewitt, Jonathan Neale and Zak Brown continue in existing roles
• Ron Dennis marks his 70th birthday with decision to step down as Chairman and agrees to sell his shareholdings in both companies
• McLaren Group has secured finance in order to acquire Ron Dennis’s shareholdings, stimulate growth in its wider businesses and consolidate its financial arrangements
McLaren Automotive and the McLaren Technology Group are being brought together under one corporate structure to be called the McLaren Group. The announcement unifies all activities under a single coordinated strategy and brand, allowing the exceptional reputation of each business for technological excellence to be used across the entire Group for the benefit of all its customers, partners and employees.
The Bahrain Mumtalakat Holding Company and TAG Group become the McLaren Group’s long-term majority shareholders. Shaikh Mohammed bin Essa Al Khalifa will be McLaren Group’s Executive Chairman, Mansour Ojjeh its Executive Committee Principal. Mike Flewitt continues to lead McLaren Automotive as Chief Executive Officer while McLaren Technology Group Chief Operating Officer Jonathan Neale and McLaren Technology Group Executive Director Zak Brown also continue in their current roles.
The TAG Group first invested in McLaren in 1984 and is the longest standing of the McLaren Group’s shareholders. They were joined 10 years ago by the Bahrain Mumtalakat Holding Company. Both remain committed to McLaren and are excited for its next phase of growth.
Mansour Ojjeh (Executive Committee Principal, McLaren Group) said:
“Since I became a major investor in the business 33 years ago, I am exceptionally proud of what each of our extraordinary McLaren businesses have achieved, growing independently and entrepreneurially. Now, as they have reached world-class scale and success, it is the right next step to unify the strategies and brands to create a stronger centre of Luxury Automotive, Racing and Technological excellence.
“In a matter of just seven short years, McLaren Automotive has established itself as one of the world’s leading creators of luxury sports and supercars. Its products are now routinely hailed as best-in-class. Mike Flewitt and his team have done, and are continuing to do a brilliant job, and the company’s recent announcement of a fourth consecutive year of profitability indicates a robust future. The new McLaren 720S, the first car to be launched under its Track22 business plan, is already sold out well into 2018 and there will be a lot more exciting cars where that came from.
“McLaren Racing, part of McLaren Technology Group, is not currently achieving the on-track success in Formula 1 that we know it is capable of, and that it has achieved in the past, but that will change. As motor racing is in our DNA, we exist to win in Formula 1 and be the best in everything we do. Jonathan Neale and Zak Brown, supported by Eric Boullier and the best engineers, mechanics and marketers in Formula 1, are fully engaged in the process of bringing about that turnaround, and it will be great to see McLaren back in the winners’ circle before too long.
“McLaren Applied Technologies continues to go from strength to strength. Partnering with companies that share our visionary determination to innovate, it is becoming profitable as well as pioneering ground-breaking technologies. And its scope for development is exciting. This is an area of our business in which we intend to invest, with a view to achieving consistent growth.”
Shaikh Mohammed bin Essa Al Khalifa (Executive Chairman and Executive Committee principal, McLaren Group) said:
“McLaren is unique, due to its strong heritage and passion to be best in everything it does, but also because no other company in the world can claim a corporate structure that comprises automotive, motorsport and applied technologies. It’s clear that as one Group, each of those three pillars of our business will support and enhance the other two.
“Together they will embark on what I firmly believe to be a new and even more successful era in the McLaren brand’s dynamic and fascinating 54-year history.”
The McLaren Group employs 3400 people located largely at its iconic McLaren Technology Centre headquarters in Woking, UK, and in 2016 had a combined turnover of £898 million. McLaren Automotive celebrated the production of its 10,000th car in December 2016 and now sells its family of Sports Series, Super Series and Ultimate Series products across 30 global markets. The entrepreneurial McLaren Technology Group encompasses McLaren Applied Technologies, McLaren Marketing and McLaren Racing which has won 182 Formula 1 Grands Prix and 20 Formula 1 World Championships.
The announcement follows the decision of Ron Dennis CBE to step down as Chairman of McLaren Automotive and McLaren Technology Group, reaching agreement with his fellow shareholders to sell his shareholdings in both companies. McLaren Group has secured long-term financing to acquire these plus stimulate growth in its wider businesses and consolidate its financial arrangements.
J.P. Morgan is acting as financial adviser to the McLaren Group and will be leading a debt capital markets financing for the transaction.