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Williams GPE finalises refinancing process


By Andrew Hooper
April 11 2020

With the sale of  Williams Advanced Engineering in December 2019 Williams Grand Prix Engineering has had to move through a process of refinancing the companies corporate borrowings. This has seen the company enter into a new refinancing arrangement with banking partner HSBC. As for whether this is a last attempt to keep Williams GPE afloat is a matter for discussion but it would seem that this refinancing is very much something that will allow the team to get past its current difficulties and recover financially.

 
 Williams GPE finalises refinancing process
 

With the sale of  Williams Advanced Engineering in December 2019 Williams Grand Prix Engineering has had to move through a process of refinancing the companies corporate borrowings. This has seen the company enter into a new refinancing arrangement with banking partner HSBC.

Williams GPE is a team that was floated on Frankfurt’s stock exchange with 52.3% owned by its founder Sir Frank Williams. However in recent years its financial situation has seen it struggle having lost a considerable amount in its revenues by finishing last in the constructors championship in the past two seasons. As of June 2019 the company had made a net loss of £20.9m on £77.8m of revenue over the previous six months.

But 2020 would see the Williams company having to also contend with the coronavirus pandemic and the cancellation or postponement of races. This has seen the teams’ prize money and sponsorship revenue either disappear or become limited.

The refinancing also includes a loan from a company owned by Michael Latifi's Latrus Racing. Latrus Racing was founded by Michael Latifi in 2012 and is involved in the racing activities of his son Nicholas. Through his companies Michael Latifi is a sponsor of the Williams team through Sofina, his Canadian food products company. He is also a part owner of the McLaren Group, having made an investment in May 2018.

The refinancing involves a mortgage on the team's land and buildings at Grove, as well as factory plant and machinery. Included as security are "heritage assets" in the form of over 100 Williams F1 cars covering the full 42-year history of the team.

In an interview with Autosport.com Claire Williams said: "Following the sale of WAE at the end of 2019 we began a refinancing process.

"After considering a number of options, we have now concluded our refinancing with a consortium of lenders, all of which was negotiated on an arms-length commercial basis.

"The loan package provides us with the resources that we need moving forward."

The list of Williams cars offered as security ranges from an FW06 of 1978 to the 2019 FW42. It also includes various examples of all the World Championship winning cars quite a few of which are on show in the Williams collection at Grove. Many of the cars are in full running order and are seen regularly in historic events, while others are in show car spec. Some are currently out on loan to museums.

As for how much the loan is for the documents do not state how much is involved but given the value of the secured assets it is thought to be at least £50m.

As for whether this is a last attempt to keep Williams GPE afloat is a matter for discussion but it would seem that this refinancing is very much something that will allow the team to get past its current difficulties and recover financially. But if the future does not deliver in terms of revenues from say points in the Constructors Championship it may be a case of the banks and Michael Latifi could gain control of the company.

But it will all come down to the nature of the repayments under the refinancing agreement. Maybe Williams backers may give them some latitude in terms of allowing them a period of recovery. Time will tell on this aspect of the agreement.

 

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Williams GPE finalises refinancing process
Discussion started by Williams F1 , 11/04/2020 07:58
Williams F1
11/04/2020 07:58
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Stu69
14/04/2020 22:57
[www.whichcar.com.au]

Interesting read!

IanSmithISA
15/04/2020 08:35
Good morning,

Quote:
Stu69
https://www.whichcar.com.au/car-news/motorsport/williams-f1-team-loan
Interesting read!

Seems to be a copy of many similar posts. :-)

To me it seems like the writer is unfamiliar with the loans Williams had before the sale of most of WAE.

The previous arrangements had all of WGPH assets pledged along with WAE, as WGPE now only holds a small proportion of WAE the Heritage Assets are merely a substitution.

Again this article talks about the F1 entry, I think this needs further explanation by the writer as I don't understand it. The entry belongs to WGPE and is not transferable, Sir Frank is the major share holder in WGPE and as far as I can see

[beta.companieshouse.gov.uk]

these shares are not part of the security offered.

Still no source for the £50m loan amount. :-(

Even if the loan amount is correct the security offered and the loan amount is not much different to the position 5-6 years ago except that then none of the lenders actually wanted an F1 team whereas now one of them might.

Bye

Ian

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