Williams F1 could be floated on the stock market
Discussion
http://www.autosport.com/news/report.php/id/89028
Autosport said:
By Jonathan Noble Friday, January 21st 2011, 11:50 GMT
Williams is considering the radical step of a public flotation in a bid to secure its long-term financial health, the team announced on Friday.
After much speculation about the Grove-based outfit's financial health in recent months following the departure of a number of sponsors at the end of last year, the team has responded by mapping out its vision to help bolster its financial future.
A statement from team principal Frank Williams said that a flotation on the stock market would be a boost, but would help ensure its long-term survival.
"For some years I have been considering how to secure the long-term ownership of Williams such that it will remain true to the aims with which Patrick and I established the team back in 1977," said Williams.
"My goal then was to race in Formula 1 as an independent constructor. This was and is my great passion and I will race for as long as I continue to be blessed with good health. It is also my desire that the team is in good shape to go on racing long after I am gone.
"To that end, it is prudent and necessary to plan for an ownership structure that will enable Williams to be an independent Constructor, owned and staffed by people committed to Formula 1 and to the sound business practices which have supported us over three decades.
"I have concluded that the option which will best achieve this is to broaden our shareholder base with public shareholders, while having a stable core of long-term investors closely involved in the running of the team. This will ensure stability, good governance and will, I believe, enable us to attract and retain the best people and partners.
"Patrick, Toto and I are therefore examining this option closely and, if the environment is propitious, we may act in the near future."
Williams and team co-owner Patrick Head long held out to maintain full control of the team they set-up, but did sell a 10% stake to Austrian businessman Toto Wolff at the end of 2009.
Despite any imminent move to sell the team on the stock market, Williams has made it clear that he will maintain his position as the majority shareholder and team boss.
"Regardless of whatever steps we take, I shall remain the majority and controlling shareholder and the Team Principal of AT&T Williams," he said.
Williams is considering the radical step of a public flotation in a bid to secure its long-term financial health, the team announced on Friday.
After much speculation about the Grove-based outfit's financial health in recent months following the departure of a number of sponsors at the end of last year, the team has responded by mapping out its vision to help bolster its financial future.
A statement from team principal Frank Williams said that a flotation on the stock market would be a boost, but would help ensure its long-term survival.
"For some years I have been considering how to secure the long-term ownership of Williams such that it will remain true to the aims with which Patrick and I established the team back in 1977," said Williams.
"My goal then was to race in Formula 1 as an independent constructor. This was and is my great passion and I will race for as long as I continue to be blessed with good health. It is also my desire that the team is in good shape to go on racing long after I am gone.
"To that end, it is prudent and necessary to plan for an ownership structure that will enable Williams to be an independent Constructor, owned and staffed by people committed to Formula 1 and to the sound business practices which have supported us over three decades.
"I have concluded that the option which will best achieve this is to broaden our shareholder base with public shareholders, while having a stable core of long-term investors closely involved in the running of the team. This will ensure stability, good governance and will, I believe, enable us to attract and retain the best people and partners.
"Patrick, Toto and I are therefore examining this option closely and, if the environment is propitious, we may act in the near future."
Williams and team co-owner Patrick Head long held out to maintain full control of the team they set-up, but did sell a 10% stake to Austrian businessman Toto Wolff at the end of 2009.
Despite any imminent move to sell the team on the stock market, Williams has made it clear that he will maintain his position as the majority shareholder and team boss.
"Regardless of whatever steps we take, I shall remain the majority and controlling shareholder and the Team Principal of AT&T Williams," he said.
Williams Press Office said:
Q & A: Adam Parr on Williams' flotation
Friday, January 21st 2011, 11:55 GMT
Conducted and provided by Williams's press office.
Q. It sounds like Williams is considering a flotation on the stock exchange. Would that be correct?
Adam Parr: Yes, it would be correct to say that Williams F1 is considering a flotation on the stock exchange. At this stage, all we have concluded is that it is the best way to secure the future of the team and its 450 employees.
Q. What is the timetable?
AP: As the plan develops we will provide further information.
Q. Is retirement a current consideration for Frank?
AP: No. Retirement is categorically not on Frank's agenda. Anyone who knows Frank knows this.
Q. Are there any concerns surrounding Frank's health?
AP: No. Frank's health is absolutely fine.
Q. What other options have the Board investigated?
AP: We have had many approaches in the past, but none have offered the same benefits as this route.
Q. Toto Wolff invested in the team in November 2009. What is his future role?
AP: Toto is a non-executive director and a significant shareholder in the company. He has already established himself as an important part of the team and he will play a central role in its future.
Q. If Williams were to go public, what are the implications for the team's partners and relations with the FIA and FOM?
AP: The team has always enjoyed honest and open relationships with its partners, the governing body of the sport and the commercial rights-holder. Whether we are a public or private company, this will not change.
Q. Would any flotation involve raising funds for the company?
AP: No.
Q. Does Williams F1 have the financial track record to support a flotation?
AP: Yes, we believe we do. The company has always been run on sound financial principles. In spite of the economic environment in recent years, we have turned a profit and generated positive cash-flow from operating activities in 2008, 2009 and 2010 and we have a fully contracted budget for 2011.
Would this provide the stability that Williams need?Friday, January 21st 2011, 11:55 GMT
Conducted and provided by Williams's press office.
Q. It sounds like Williams is considering a flotation on the stock exchange. Would that be correct?
Adam Parr: Yes, it would be correct to say that Williams F1 is considering a flotation on the stock exchange. At this stage, all we have concluded is that it is the best way to secure the future of the team and its 450 employees.
Q. What is the timetable?
AP: As the plan develops we will provide further information.
Q. Is retirement a current consideration for Frank?
AP: No. Retirement is categorically not on Frank's agenda. Anyone who knows Frank knows this.
Q. Are there any concerns surrounding Frank's health?
AP: No. Frank's health is absolutely fine.
Q. What other options have the Board investigated?
AP: We have had many approaches in the past, but none have offered the same benefits as this route.
Q. Toto Wolff invested in the team in November 2009. What is his future role?
AP: Toto is a non-executive director and a significant shareholder in the company. He has already established himself as an important part of the team and he will play a central role in its future.
Q. If Williams were to go public, what are the implications for the team's partners and relations with the FIA and FOM?
AP: The team has always enjoyed honest and open relationships with its partners, the governing body of the sport and the commercial rights-holder. Whether we are a public or private company, this will not change.
Q. Would any flotation involve raising funds for the company?
AP: No.
Q. Does Williams F1 have the financial track record to support a flotation?
AP: Yes, we believe we do. The company has always been run on sound financial principles. In spite of the economic environment in recent years, we have turned a profit and generated positive cash-flow from operating activities in 2008, 2009 and 2010 and we have a fully contracted budget for 2011.
flemke said:
onesmallstep said:
No, just a diversion leading to more decline.
And the basis for your comment is...?
ETA: As I sit here in my Williams branded polo shirt. I do sometimes wonder if I'm a geek.
Edited by HereBeMonsters on Sunday 23 January 00:21
I am somewhat amazed when their savour Toto Woolf is supposed to hold 10% of Williams shares and is supposed to be a hugely wealthy Austrian investor. From my experience this sounds somewhat far fetched and nobody in their right mind would invest in Williams unless they spin off their wonderful conference facility and research facilities. These may be worth money but the F1 side is not worth a bean.
belleair302 said:
I am somewhat amazed when their savour Toto Woolf is supposed to hold 10% of Williams shares and is supposed to be a hugely wealthy Austrian investor. From my experience this sounds somewhat far fetched and nobody in their right mind would invest in Williams unless they spin off their wonderful conference facility and research facilities. These may be worth money but the F1 side is not worth a bean.
I don't know the details, but suspect that you are wrong.For one thing, there is the property itself, which I presume is owned by them.
The next thing is that the brand certainly has value. Not, at the moment, McLaren-value, but meaningful value. They've won more Constructors' C'ships than anyone bar Ferrari. Something beyond F1 nonsense could be made out of that.
Just within F1 nonsense, however, there is the potential for meaningful return on capital. The teams are systematically getting their cost base down - commonality of parts, severe limits on testing, et al. At the same time, the teams' % of "Bernie's" revenue will, if anything, go up, and the gross revenue itself will be going up with the expanded calendar and more intelligent leadership from Todt than they had from Fu<kwit. VW are making noises about coming into F1. One of the Korean car makers could easily decide to do the same. There is a fixed number of entrants, the easiest way by far of getting into the sport is by buying an established team. If running a team becomes regularly profitable - and there is no reason why it should not be - then Williams F1 could be worth a reasonable amount.
Mermaid said:
Would a venture capitalist invest more money in the firm?
Not likely venture: it's a well-established operation, but one with potential value beyond its historical focus. So-called private equity more likely, which is what that Toto dude probably is.
The advantage of a flotation is that, as with a football team, you'll get some loyalists who will invest at a price that may exceed the pure commercial value.
dpbird90 said:
davepoth said:
What Williams need is a partnership with a major manufacturer, like McLaren had with Mercedes.
Yeah, the last time they had any success was in the BMW tieup, but then BMW decided they wanted their own team. Hmm, VAG are supposedly entering F1 soon, Williams-Audi?The way I see it is Frank wants a decent amount of cash to inject in to the team. Private investors will want some sort of control/power, doesn't sit well with Frank. I think he's watched Toyota, BMW, Honda come and go and numerous teams be sold, renamed, then sold and renamed again, so he is very wary of partners etc.
If VAG did ever come to F1 they'd likely want to rename the team, whilst Manor were happy to do that Frank isn't.
I think he sees this as a way to bring in money without actually giving up and control/power.
If VAG did ever come to F1 they'd likely want to rename the team, whilst Manor were happy to do that Frank isn't.
I think he sees this as a way to bring in money without actually giving up and control/power.
Crafty_ said:
The way I see it is Frank wants a decent amount of cash to inject in to the team. Private investors will want some sort of control/power, doesn't sit well with Frank. I think he's watched Toyota, BMW, Honda come and go and numerous teams be sold, renamed, then sold and renamed again, so he is very wary of partners etc.
If VAG did ever come to F1 they'd likely want to rename the team, whilst Manor were happy to do that Frank isn't.
I think he sees this as a way to bring in money without actually giving up and control/power.
I believe that Parr said in the interview that any flotation would not involve funds going to the company. That is to say, some combination of Frank, Patrick, and maybe the recent investor, would be selling part of their ownership. That is perfectly reasonable: they're both around typical retirement age, they'd like some liquidity after having spent the last 30+ years working hard to build this thing.If VAG did ever come to F1 they'd likely want to rename the team, whilst Manor were happy to do that Frank isn't.
I think he sees this as a way to bring in money without actually giving up and control/power.
Mattt said:
Do you think that Williams will attract the same level of fanatism beyond economics that Soccerball teams would?
I would've thought that the average F1 fan would be slightly more intelligent than an average football fan.
That's fair enough, in terms of ROI. I don't think that ROI is the only thing that matters with a lot of fans. If they can spend money on caps and shirts and tickets to events where maybe if they're lucky they'll see one overtake in the whole race, they can spend their money in this different way as a means of feeling connected to their favourite entrant. So long as they understand that it's like going to a casino - as with roulette, the odds are against them, and they're playing primarily for the emotional return, rather than for a financial one - that's cool.I would've thought that the average F1 fan would be slightly more intelligent than an average football fan.
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