The word from the UK is that an agreement has been signed between Lotus F1 Team and Renault for the French manufacturer to have an option to buy the team. The price of the option is believed to be little more than a payment to settle the dispute with Her Majesty’s Revenue and Customs. This means that the team will avoid being put into administration on Monday. Renault will now move forward on the purchase, with the goal being to take control of 70 percent of the team. The previous owners will still have some equity left in the team, but are likely to take a major financial hit as Renault is not believed to be offering the previous shareholders much money. It could be that there will be long term profits, in which case they will be able to recoup some of the losses incurred, but it will be a long time before that happens – if it ever happens.
There is a suggestion that there may be a window for another buyer to deliver a payment before a deadline in the next couple of hours, but if this does not happen, Renault will have won the game.
joeblogsf1 
Ruhan blinked first then? Or you could argue he’s got some money without investing more (Maldonado renewal must have helped)
This was predictable. Renault pays the least possible for Lotus by rescuing them from dissolution at the last minute.
It was not predictable.
Well tell me why they would pay more? This was the best price/oppurtunity Renault would get to acquire Lotus.
Because there was no guarantee that they would get it…
I thought they would walk away from F1, but nice for the Lotus staff to see Renault come to the rescue.
F1 shouldn’t really be like this, should it?
That is a very key point. No F1 should not be like this… Change is needed ahead.
Do I lack an understanding of the history of F1 or is being heavily involved in the sport actually less attractive now? Is it due to complexities of this early hybrid era? Are the structural inequities of F1 and its stewardship creating this? I really got the impression that Renault had one foot out the door, and that surprised me.
+1
It didn’t start well, it didn’t end well.
Hopefully this whole Lotus/Genii/Dany Bahar debacle of recent years is merely a footnote in the proud history of Lotus F1.
I never saw them part of Team Lotus history. I doubt that many did.
“the proud history of Lotus F1”; you’re confusing an x-F1 team with a corporate branding exercise
For the sake of the poor folk at Enstone I hope this deal goes through and provides them some stability and a foundation from which to grow. If the powers-that-be aren’t careful we could still see F1 2016 without Lotus, Renault, Red Bull and STR (plus Jenson!)
Hi Joe,
Great to see this has occured, I think people forget that away from the glitz, glamour and racing there are people back in Enstone worrying about putting food on the table if the company goes bust… Hopefully this puts an end to those concerns.
Out of interest, whatever happened to Force India’s money worries? Vijay Mallya was in all sorts of trouble according to press reports, however it now seems to have subsided?
I do not believe that they have gone away.
They are the same
Which reminded me that the Enstone cars were being called Renaults long after Renault ceased to have any involvement in the team. We then had the long protracted Group Lotus vs Team Lotus legal wranglings. We eventually ended up with the team being called Lotus despite no involvement from the Lotus car manufacturer. It now looks like we’re going to end up back where we started 6 years ago.
I wonder if any of the parties involved in the saga actually ended up in profit. No doubt all have their regrets.
So hope this true….
Thanks Joe, appreciate the reply 🙂
I am puzzled about the current Lotus problems at the Japanese GP. They are locked out of their hospitality suite (or whatever the right term is) due to unpaid bills, but they are able to setup in their garage as normal.
I guess if this was a European race they would have their motor homes, but I assumed the logistics at flyaway tracks would be a package, and also dealt with on behalf of the teams by FOM. Neither of these appear to be the case.
Joe – could you give a brief explanation of how the Lotus team is able to take their team and equipment to the race, put the cars out in free practice, yet apparently are forced to eat breakfast at an “international burger restaurant” and use other teams hospitality facilities at the circuit itself?
Because some bills have been paid and some have not been paid.
Do you think Bernie was playig hardball over the freight and hospitality to make the need for renault to do the deal more urgent?
Joe, your thoughts on the implications for Lotus’ creditors?
We will have to wait and see
Joe, do you know if Renault intend buying the whole team or just a controlling interest like 51%, leaving the current major shareholder with some shares – on which they may recoup some cash if the value of the team goes back up?
Sorry – missed out the word ‘eventually’
I hope this is correct, but one should not automatically think that Renault have won the day. As Joe mention Renault has an option on acquiring the Enstone team. This is a pure property play concept, that you pay out a sum of money to acquire an option for a set period of time, and you agree the terms of purchase, but if another player wants to enter the market, then they have to wait until the option period has expired, and then put down there offer.
Andrew Ruhan has never come out the wrong side of a deal so far, and given the amount of money they – Ruhan and Genii have put into Enstone over the years, someone or both is taking a massive haircut on their investment.
Personally I think there is still a lot to play for here, and that Ruhan who is a motorsports nut, might have someone else in the background, and this option is a deal to keep the creditors at bay while the “other” party get there financing in order.
Also Andrew Ruhan is a Director of both Genii and Enstone since 2013, so one wonders how much he has pumped into both businesses.
Does one really care how much Ruhan has pumped in?
At the end of the day protection for jobs and continuity at Enstone is paramount, so if he gets a short-back-and-sides, so be it.
Peter,
One has to be a little bit careful when talking about, do we care if these people lose money or not in the Enstone team.
Like the Pension funds that backed CVC when they acquired F1, these pension funds have enjoyed great success, but the Genii funds haven’t come personally from Gerard Lopez or Eric Lux, small amount maybe, but a majority of it is Pension funds. As for Andrew Ruhan, one thinks that most of it is his own money, so one cannot feel to sorry for that. The amount of debt that Enstone has is north of £150M, and with what Renault is talking about acquiring the team – business for, around £10M, then someone – pension funds are on to a real loser.
The Monday court case – HMRC is for £900K, but the amount outstanding to them is around £2.7M, that is the PAYE which the business has taken from the wages, yet failed to pay across to the government.
In the paper’s today, the VW share drop, has hit a number of UK councils – pension scheme. In one they held share worth £250M, now that value is less than £70M that is pretty impressive drop and is going to be hard to recoup that amount. They invested around £150M, so sitting on a major lost, which the fund can’t afford to lose.
Yes I agree that protecting jobs is very important, but we have seen teams in the past go to the wall, and it will happen again. We could find that Red Bull pulls out as no one will supply them with an engine, does that mean that supporters of the Red Bull team will boycott Mercedes and Ferrari products, as they feel let down? What about these people and their jobs?
What one can say about Andrew Ruhan is that he installed Mathew Carter to steady the boat, after a load of miss management by the Genii people. I think he just ran out of liquid funds to keep it afloat, plus he is been sued for divorce in the UK, and has a major court case coming up in 2016, as an ex partner is suing him for £100M, so yes you may be right, why should we care about his loss’s
One final thing to remember he is a Director of both companies, and has to be seen to do the right correct / thing. The Companies Act has changed a lot, and this is a high profile case, and if he screws up then criminal charges could be brought against him.
The ink is not dry on the Caterham fiasco and the gossip – rumours are that past owners might have some serious questions to answer to. Everyone praised Tony, but maybe not the employees.
I’m very, very surprised by this. Carlos is a smart guy. I guess even smart guys have bad days… 😦
Sure. Allowing Infinity branding on ‘those’ cars was one of them……
Great for Enstone all the workers. However, I get the feeling that F1 as a whole has dodged a bullet. No doubt, the way things are going, there will be some more along soon!
Joe, any idea why BCE is absent at present and would this help or hinder any current negotiations.
If this goes through will there be any Renault power units on the grid next year?
Maybe the Team Renault unit…………. unless they get a Mercedes engine.
“There is a suggestion that there may be a window for another buyer…..”
Is there any solid information about any other potential buyer that has been lurking in the weeds???
Ever heard of Colin Kkkk….no we won’t go there 🙂
“another buyer”?
Who on earth would that be? And what are they waiting for?
I’ve wondered for a while why Red Bull did not think about buying Lotus. It would have got them a team with a Mercedes PU contract and it would have truly scuppered Renault’s chances on getting a works team for peanuts.
+1
Presumably it isn’t as simple as that. Perhaps the Mercedes supply contract has a ‘change in control’ clause – that certainly wouldn’t be unusual generally and would pretty much be expected in the nebulous world of F1
As it is, it sounds like there will be many accountants working very late nights this weekend to get all the due diligence and paperwork done in time for the High Court hearing.
Lotus never really was Lotus was it, I expect Colin has been turning in his grave watching these spivs abusing the name.
i thínk there were jears to love looking at it (Kimi’s first year out of retirement for example, and several other recent years were quite solid too), and he might have awed at the financial juggling the owners were able to pull off to keep the team racing at high level too.
“spivs”, really?
Renault plays a tough game.
Can’t say that by the way this thing is un-winding that the Lotus owners haven’t earned it.
Very sad given all the wealth in F1 that no one offered to pick the tab for the Lotus hospitality/food tent. Pathetic
And what if Red Bull pulls out of F1 finally after having scared off any possible engine supplier thanks to Marko and Horner. If I were The Régie I would purchase the Milton Keynes headquarter lock stock and barrel. No substantial amendments needed, no debts (I hope). Could this be a reason why it is still all quiet on the Lotus front?
And Toro Rosso goes to FIAT? The Alfa Romeo badge on the Ferrari bonnet is a nice gesture (c by Joe Saward) but as a team it would be even better…