Site logo

Brawn and Fry get £150 million payout

NEWS STORY
07/03/2011

Last week was a good one for Formula One team owners. First came the news on Wednesday that Williams co-founder Patrick Head had pocketed £31m through floating the team on the stock exchange. Then on Sunday we discovered, courtesy of an article in the Mail by Pitpass' business editor Chris Sylt, that Nick Fry and Ross Brawn made an estimated £150m between them from the sale of Brawn, the team they bought from Honda for just £1 in 2009.

Fry is believed to have received £56m with Brawn getting a total of £100m - a sum equivalent to three times Force India's entire revenues in 2009. The remaining £26m was split between the other directors who ran the team before Mercedes and Abu Dhabi wealth fund Aabar bought into it in November 2009 and renamed it Mercedes Grand Prix. The two companies initially acquired a 75.1% stake but last week took complete control by buying the remaining 24.9%.

Sylt has traced the ownership of the team's shares to build the picture of the huge fortune made by its former owners. After the management buyout from Honda Brawn held a 54% stake with 31% owned by Fry and the remaining 15% in the hands of four other directors.

Brawn was paid an estimated £72.9m when he sold 40.5% of the team to Mercedes and Aabar in 2009 and he then banked a further £24.3m last week on the sale of his remaining 13.5% stake. Fry initially sold 23.3% for around £41.9m and then he is believed to have made £13.9m last week from selling his remaining 7.7%. It values the team at £180m which is much higher than previously believed. There is good reason for this.

When Mercedes and Aabar made their initial acquisition it was thought that they had paid as little as £50m since it was widely believed that the team did not have enough money to continue in F1. Despite winning the championship in 2009, Brawn failed to sign any significant sponsors with one of its biggest-paying deals being the $5m it received from Virgin.

However, the truth of its financial position was revealed when its 2009 accounts were published last year as they showed that it had revenue of £235m - the highest ever recorded by an F1 team. It had £60.5m cash in the bank and an after-tax profit of £98.5m. Valuing the team at two times retained profits is conservative to say the least, particularly given that it had just won the championship.

The end of 2009 was the perfect time for the owners to sell up as the team's performance has reversed since then. It failed to win a race last year and finished fourth in the standings. After last week's buyout there is now even more pressure than before for it to rev up its results.

LATEST NEWS

more news >

RELATED ARTICLES

LATEST IMAGES

galleries >

  • Pitpass.com latest F1/Formula 1 images
  • Pitpass.com latest F1/Formula 1 images
  • Pitpass.com latest F1/Formula 1 images
  • Pitpass.com latest F1/Formula 1 images
  • Pitpass.com latest F1/Formula 1 images
  • Pitpass.com latest F1/Formula 1 images
  • Pitpass.com latest F1/Formula 1 images
  • Pitpass.com latest F1/Formula 1 images
  • Pitpass.com latest F1/Formula 1 images
  • Pitpass.com latest F1/Formula 1 images
  • Pitpass.com latest F1/Formula 1 images
  • Pitpass.com latest F1/Formula 1 images
  • Pitpass.com latest F1/Formula 1 images
  • Pitpass.com latest F1/Formula 1 images
  • Pitpass.com latest F1/Formula 1 images
  • Pitpass.com latest F1/Formula 1 images
  • Pitpass.com latest F1/Formula 1 images
  • Pitpass.com latest F1/Formula 1 images
  • Pitpass.com latest F1/Formula 1 images
  • Pitpass.com latest F1/Formula 1 images

POST A COMMENT

or Register for a Pitpass ID to have your say

Please note that all posts are reactively moderated and must adhere to the site's posting rules and etiquette.

Post your comment

READERS COMMENTS

 

No comments posted as yet, would you like to be the first to have your say?

Share this page

X

Copyright © Pitpass 2002 - 2024. All rights reserved.

about us  |  advertise  |  contact  |  privacy & security  |  rss  |  terms