It’s been quite the day for Caterham F1 Team. After months of uncertainty and continual promises of a resolution to the problems blighting the Leafield-based team, a statement was released yesterday revealing that the new buyers of the team – a consortium made up of Swiss and Middle Eastern investors – had not had the shares transferred to them by previous owner Tony Fernandes.
Except he isn’t the previous owner – Fernandes still owns Caterham F1 Team despite claiming earlier this month that he no longer had anything to do with the operation. The Malaysian businessman sent out a tweet yesterday saying: “If you buy something, you should pay for it. It’s quite simple”.
The impasse appears to be like this: Fernandes claims not to have received his payment, while the potential new owners claim they have made it, but have not received the shares in return.
This was put in black and white today when the new owners, a Swiss company called Engavest SA, issued the following statement:
“On 29 June 2014 Engavest SA signed a sale and purchase agreement with Tony Fernandes and Caterham Group to acquire the shares of 1Malaysia Racing Team/Caterham F1.
“Engavest SA has fulfilled all the conditions precedent, including paying the purchase price for the shares. The shares have not been transferred and therefore Mr Fernandes remains the owner of Caterham F1 and is fully responsible for all its activities.”
In response, Tony Fernandes stated: “We agreed in good faith to sell the shares to a Swiss company named ‘Engavest’ on the basis that Engavest undertook to pay all of the existing and future creditors, including the staff.
“The continued payment of staff and creditors was so important to me that I ensured that the shares would not be transferred to the new buyers unless they complied with this condition.
“Sadly, Engavest has failed to comply with any of the conditions in the agreement and Caterham Sports Ltd (the UK operating company of the F1 team) has had to be put into administration by the bank, with large sums owing to numerous creditors.
“Our agreement with Engavest was very clear: there was no legal obligation to transfer the shares to them unless certain conditions – which included paying creditors – were met. Those conditions have not been met.”
With Caterham Sports Ltd being put into administration, workers at the factory in Leafield were prevented access from the site by administrator Finbarr O’Connell.
“They can’t get into the factory today,” the administrator confirmed to Reuters. “They are using my facilities and haven’t paid me.
“Effectively 1MRT have been in the building for last few days since I arrived.
“We are trying to reach an acceptable arrangement for them to be there. We had a meeting yesterday with 1MRT and lawyers and the offer they made was unacceptable. So I’ve sent them away.
“Hopefully they can come up with an acceptable proposal. I don’t think this is gone. It’s just a case of who has got the money to make it work.”
So while the ownership of the team remains in the lurch and the employees are unable to access the factory at Leafield, Caterham’s involvement in the United States Grand Prix next week seems to be in serious doubt.
However, F1 supremo Bernie Ecclestone confirmed to the BBC that he is looking into ways to save Caterham despite saying in the past that he would rather have ten teams in Formula 1.
“We’re trying to help in any way, which we do with anybody that has run into a bit of difficulty,” the F1 supremo said.
Ever since Fernandes’ supposed sale of the team at the end of June, the alarm bells have been ringing at Caterham. A number of employees at Leafield were dismissed, prompting legal action being taken by both the ex-workers and the team against each other.
In Russia, Kamui Kobayashi was even ordered to stop his car despite there being nothing wrong with it, suggesting that the team needed to preserve the life of the parts beyond the race weekend. Manfredi Ravetto had been in charge of the team, but he has now also been relieved of his duties.
Former F1 team principal Colin Kolles brokered the deal, and has admitted that the team’s hopes of going to Austin were dependent on the administrator and its negotiations.
This saga looks set to rumble on, but if a solution doesn’t come in the next few days, we are poised to have a 20-car grid for the United States Grand Prix in Austin at the beginning of next month.
UPDATE 1425 ET – Engavest has issued a statement in response to Tony Fernandes’ claims:
“Engavest SA strongly refutes the allegations of Tony Fernandes and Caterham Group CEO Graham MacDonald regarding its conduct while trying to purchase Caterham F1. Our statement of earlier today still stands.
“Every single condition precedent of the Sales and Purchase Agreement for which Engavest was responsible has been met. Only the seller, which includes Mr Fernandes, failed to meet his obligations. All salaries have been paid.
“The claims of Mr Fernandes and Mr MacDonald contradict their own press statement dated 3 October 2014.
“Incidents such as a Caterham Group representative forcibly breaking into a filing cabinet containing our private and confidential documents and the continued refusal to deal with the outstanding loan of Exim Bank and complete the agreement has culminated in Engavest’s total contempt of Mr Fernandes and his Group executives with whom we entered a deal in good faith.”
And so the plot thickens…
