The McLaren Group, which includes both the Formula 1 team and the road vehicle business, was hit hard by the economic consequences of the coronavirus pandemic.
However, an attempt to refinance its business to overcome short-term difficulties met with a roadblock when a group of creditors opposed attempts to raise funds by releasing securities such as the collection of heritage cars and properties.
The urgency of the situation prompted McLaren to go to court recently to enable his plan to be implemented. Documents show that the company could face major problems if the refinancing were blocked.
It was suggested that there is even a risk of bankruptcy if £ 280m cannot be raised by July 17th.
“The proposed transactions will allow the group to access the additional liquidity required to ensure that the group can continue operating through 2021,” the court documents said. “This will bring significant benefits to the Group’s creditors (by preventing a cash flow crisis and bankruptcy that destroys value).”
While McLaren had managed to take his case to court, separate talks with the National Bank of Bahrain were also started to arrange a loan to raise funds.
The NBB is 44% owned by the Bahraini state fund Mumtalakat Holding Company, which has a 56% stake in McLaren.
On Monday, the NBB made a statement to the Bahraini stock exchange confirming that the loan had been agreed and signed.
It said: “The National Bank of Bahrain hereby confirms to the markets that the final documentation has been signed and all necessary approvals have been granted in relation to a GBP 150 million financing facility.”
The loan gives McLaren some leeway in finding the funding it needs under its other refinancing plan, and will also act as a buffer while operations resume and races resume this weekend in Austria.
