Williams F1 sold to US-based investment group Dorilton Capital

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You’ll recall that Williams F1 was looking for strategic investment earlier this year and it seems they have found that investment in the form of small and middle-market investment group, Dorilton Capital out of New York.

The investment company lists a total of nine companies in their investment portfolio (clearly they’ve made many more investments than that) and they are mainly in the industrial, manufacturing and healthcare services arena.

The acquisition is the conclusion of a Strategic Review which was launched in late May. Dorilton Capital describes itself as a group focused on a long-term approach to investment and Williams says its key focus will be to restore the competitiveness of the team.

As part of the Strategic Review, Williams together with the Group’s financial advisers, conducted a comprehensive review of all the options available to the Company, which included exploratory discussions with a series of potential investors. This Transaction received the unanimous support of the Board of Williams, including Sir Frank, who determined the Transaction delivers the best outcome for the Company’s shareholders and secures the long-term success of the Williams Formula 1 team.

Dorilton Capital is a private investment firm headquartered in the United States. Dorilton recognizes and appreciates the importance of respecting and retaining Williams’ heritage and culture and is committed to maintaining its identity. The team will continue to race and compete under the Williams brand, with the chassis name remaining unchanged. Dorilton has no plans to re-locate the team from Grove, its traditional home.

The new Concorde Agreement means that Williams F1 will be participating in Formula 1 for the next five years. The promise of a better prize money distribution model, budget caps for the teams and a more competitive technical regulation set of rules is the carrot at the end of F1’s proverbial stick and a possible reason an outside group such as Dorilton has dipped its toe in the tepid waters of F1.

I do find the point of mortgaging the entire fleet of historic championship-winning car collection to Michael Latifi an interesting conundrum for the new owners. As a single-family investment firm, it does seem that longer term investments are at its core business. What remains to be seen is if they can turn a profit with Williams F1 and one might argue that this won’t be very realistic until the new budget cap kicks in for the 2022 season. One of their key messages is that they reinvest their cash flow into the business and that’s a good thing because they’re going to have to in order to keep this ship afloat.

I am curious about the complexion of this acquisition as well. Was it an asset acquisition only? Or did they also assume the long-term structured debt in the process? Was the debt left with the Williams family to retire or did Dorilton take on the liabilities to suppliers etc?

Claire Williams, Deputy Team Principal, commented: “The Strategic Review was a useful process to go through and proved that both Formula One and Williams have credibility and value.  We have now reached a conclusion and we are delighted that Dorilton are the new owners of the team. When we started this process, we wanted to find a partner who shared the same passion and values, who recognised the team’s potential and who could unlock its power. In Dorilton we know we have found exactly that. People who understand the sport and what it takes to be successful. People who respect the team’s legacy and will do everything to ensure it succeeds in the future. As a family we have always put our team first. Making the team successful again and protecting our people has been at the heart of this process from start. This may be the end of an era for Williams as a family owned team, but we know it is in good hands. The sale ensures the team’s survival but most importantly will provide a path to success. We are enormously grateful to Dorilton for the faith they have shown in our team and we look forward to working with them now. I would also like to thank the Williams Board and our advisers who have worked tirelessly over the past months to make this happen and our employees who have remained steadfastly loyal.”

Mike O’Driscoll, CEO of Williams, commented: “The transaction announced today marks the next stage in the history of Williams Formula 1 at an exciting time in the sport. The Company has successfully completed its strategic review and we are pleased to announce the sale to Dorilton Capital, which delivers a great outcome for shareholders and secures the long term future of the Company.”

Matthew Savage, Chairman of Dorilton Capital, commented: “We are delighted to have invested in Williams and we are extremely excited by the prospects for the business.  We believe we are the ideal partner for the company due to our flexible and patient investment style, which will allow the team to focus on its objective of returning to the front of the grid.  We look forward to working with the Williams team in carrying out a detailed review of the business to determine in which areas new investment should be directed.  We also recognise the world class facilities at Grove and confirm that there are no plans to relocate.”

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Fred

Isn’t the main focus of Dorilton to make money?

Paul Kiefer

So, is Williams still Williams (more than “in name only”), or are they now something else entirely?

MIE

Did Ferrari stop being Ferrari when the team was sold to FIAT?