Sahara India Become New Part Owners of Force India F1 Team

Multi-business conglomerate Sahara India have acquired a 42.5 percent stake in Force India, worth $100 million, with the Formula One Team now being named Sahara Force India.

A media report last Friday had stated that Sahara was in talks to take over from Vijay Mallya and that a “deal is on the verge of being finalised and that an announcement to the effect is expected in a couple of days”. But Mallya denied reports this would occur (read here).

With Sahara Group chairman Subrato Roy present alongside, Mallya announced at a press conference that subsequent to the stake sale, the F1 team was being renamed Sahara Force India. Roy will be the chairman of Sahara Force India.

The Sahara Group and Mallya’s UB Group will each have an equal 42.5 per cent stake in the team, while the remaining 15 per cent will be with the Mol family.

Force India was formed in October 2007 when a consortium (Orange India Holdings) led by Mallya and Dutch businessman Michiel Mol picked up the struggling Spyker F1 team for Euro 88 million.

Speaking about how the deal materialised, Mallya said, “I first approached Sahara only for the purpose of sponsorship. But Roy said he was interested in co-owning the team and that’s how we came to this agreement.”

Mallya said the funds injection would greatly enhance the team’s prospects. “The entire investment will be for the team and none of the existing shareholders are taking any money out. I started this team on a very limited budget and in the super-competitive F1 environment this investment will surely help in the progress of the team.”

The funds will be use for a new air tunnel, better R&D and upgradations of the facilities at the company’s factory based in Silverstone in UK.

Roy added that, “We are very happy to be joining this outfit and now we have to sit together, talk together, and discuss how to make this team the best team.”