MARCH 16, 1998
Imperial Tobacco considering F1 assault
BRITAIN's IMPERIAL TOBACCO COMPANY is looking closely at an involvement in Grand Prix racing, as part of its plan to expand sales around the world, particularly in Asia. Imperial has always relied heavily on the British cigarette market but in the 1970s the company diversified into other consumer businesses and was bought in 1986 by industrial conglomerate The Hanson Trust. It was only at the end of 1996 that the Hanson management decided to get out of the tobacco business and spun-off Imperial Tobacco, which was floated on the London Stock Exchange.
During the Hanson years the company was not involved in Formula 1, but Imperial has been a major player in motor racing sponsorship from the very beginning. In 1968 Imperial and Team Lotus did the first major sponsorship deal in Grand Prix racing history with the Gold Leaf brand backing the team for three years. When that deal ended Imperial switched brands and Lotus landed backing from John Player Special, a deal which lasted until the end of 1978 and saw JPS Lotus drivers Emerson Fittipaldi and Mario Andretti win World Championships. The company was out of F1 between 1979 and 1982 but then began a new relationship with Lotus which lasted until the Hanson takeover. Imperial was also involved with the Shadow and Hill teams in the early 1970s with its Embassy brand.
Imperial Tobacco controls nearly 40% of the British tobacco market and has sales of $6bn a year. It made a profit of over $500m in 1996. The company is involved in a number of sporting sponsorships at the moment including snooker and rugby but is looking at F1 because its major rivals BAT and Gallaher are both involved and because of the European legislation which means that tobacco sponsorship will be allowed to continue in F1 until the year 2006.
No decision is expected from Imperial until it is clear whether or not the FIA is going to bring in its own ban in 2002 but we would expect that if the 2006 deadline is maintained that Imperial will be back in F1. The obvious team to back is Tom Walkinshaw's Arrows operation which is one of the few not to have tobacco money behind it. There have been rumors for some months that the team is negotiating for a big tobacco deal and it is worth noting that the Arrows team's commercial director Jackie Oliver was an Embassy Shadow driver in 1973. Guy Edwards, who is also helping the team to find money, has also enjoyed good connections with Imperial, through the Rizla cigarette paper company, which is owned by Imperial.
If the team does land Imperial backing it would almost certainly be with the John Player Special brand as this is still heavily linked with motor racing as a result of its F1 successes in the 1970s and 1980s. It is perhaps convenient that Arrows chose a black color scheme for this season. It is also worth noting that Pedro Diniz - usually a Marlboro driver - has no tobacco badges this season.
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