APRIL 16, 2008
Super Aguri deal in trouble?
The word in the Middle East is that the bid from Magma International to buy Super Aguri F1 may have run into trouble, with Magma's backers, believed to be Dubai International Capital, apparently wavering about the price. The problem may be related to DIC's attempts to buy control of the Liverpool FC soccer team.
DIC abandoned its latest Liverpool bid about a week ago, despite having offered more than $1bn for the club. This may have been a negotiating ploy to get the current owners, Americans Tom Hicks and George Gillett, to agree to sell. Hicks apparently wants to hold on to the team and is keen to buy out Gillett, but he is not willing to sell, despite the fact that the two men stand to make a profit of $160m if they accept the DIC offer.
This would seem to be good news for Super Aguri but it appears that the $100m needed to buy the Formula 1 team is too much for DIC, given the risks involved. The team is at the back of the F1 grid and much investment is needed to move it forwards, not least because the team needs to build its own cars in 2009.
Honda F1, which has been building the cars up to now, wants to concentrate all of its efforts on its own F1 programme with immediate effect and so wants the chassis supply deal with Super Aguri ended at the first possible opportunity. Our sources tell us that the deal under discussion is worth about $100m and that this would mean no profit for anyone as the majority of the money would have to go to Honda to pay Super Aguri's debts and the remainder would be used to pay debts incurred by Aguri Suzuki himself. If the team closes down neither party will get much from the sale of assets and there is a danger that Honda will be seen as having abandoned Super Aguri, which was established to create a fully Japanese team in F1 and to give Takuma Sato an F1 drive.
Closing down the team makes no real sense as breaking up what is a fully operational F1 team is an illogical thing to do, as there are almost certainly other buyers in the market if DIC does not want the deal. The big question is whether anyone acceptable to Honda can come up with the cash in the time available. If the price reduces and Honda and Suzuki agree to take a loss, DIC may still move in and take the deal but whatever happens the clock is ticking and work needs to begin immediately if the team is to have the capability to build its own cars in 2009.