APRIL 26, 1999
Reynard consolidates Detroit links
In recent days Reynard has concluded its negotiations to buy the American racing car constructor Riley & Scott Inc. from partners Bob Riley and Mark Scott for a total of $10.4m. Riley & Scott made a profit last year of $1.8m on revenues of $6.3m. Reynard had agreed to pay $4.4m in cash and the remaining $6m in Reynard shares. Reynard will also go ahead with its acquisition of Gemini Transmissions with a split cash/equity deal. Reynard says that after its initial public offering on WallÊStreet, it will have another $13.5m to spend and is looking for suitable targets. It is thought likely that the company is most likely to invest in composite manufacturing in the US and in electronics.
Reynard says that it intends to use Riley & Scott to develop its sales in the sportscar market (where the Riley & Scott Mk III has enjoyed considerable success) and in the Indy Racing League, where the Riley & Scott Mk V has not been successful.
Reynard also admits that the purchase is designed to strengthen its relationship with General Motors, as Riley & Scott is contracted to design and build Cadillac's Le Mans 24 Hours racer, which is due to appear next season.
It is worth noting that Reynard intends to establish a design bureau in Detroit next year and that it has recently given Francois Castaing a seat on its board of directors.
Castaing is 54 and is a technical adviser to Daimler-Chrysler. A Frenchman, he spent his formative years as technical director of Renault Sport in F1 before handing over to Bernard Dudot in 1980. He joined Chrysler when it bought the American Motor Company from Renault in 1988 and became Vice-President of Vehicle Engineering under President Bob Lutz. Castaing is still very well-connected in Detroit.
It is worth noting that while Reynard is a 15% partner in British American Racing, BAR now has its own design and manufacturing team. BAR's technical director Malcolm Oastler is committed to working for BAR until the end of 2001 but he remains a member of the Reynard staff. In theory Reynard could split with BAR at the end of 2001 and enter F1 with Oastler and General Motors in 2002 or 2003.