DECEMBER 6, 1999
Telefonica buys Minardi
THE burgeoning Spanish telecommunications company Telefonica has finally concluded a deal to buy the Minardi team after months of negotiation. There are no details about how much the company - which is worth $65bn - paid for the little Italian team but the Spaniards will need to invest considerably more in Minardi to secure an engine deal for the 2000 season.
The ownership of the team is very complicated as it has gone through several stages of restructuring in recent years with a holding company being established in December 1996 which controls 70% of the team. At the time the team said that the company belonged to a consortium of international businessmen including Flavio Briatore, Gabriele Rumi and former F1 driver Sandro Nannini. Briatore later sold out to Rumi and he took control of the holding company and the team. It is unclear how many partners remain in the holding company. The 30% of the team not owned by the holding company are controlled by team founder Giancarlo Minardi (14.5%) and four other Italian businessmen including former Scuderia Italia shareholders Beppe╩Lucchini, Vittorio Palazzani and Emilio Gnutti. We have heard stories that the team's technical director Gustav Brunner is also a shareholder - presumably in the holding company.
Thus it is not clear exactly what Telefonica has bought except that it now has control of the team. Rumi will still be involved in the team to some extent as his Fondmetal Technologies business has a year to run on its two-year technology agreement with Minardi, which uses the 50% rolling road windtunnel run by Fondmetal Technologies at Casumaro.
We understand that the new owners of the team have yet to decide what to do with the team although one possible solution is to move its operations to the Barcelona area. There were moves to do this earlier in the summer with Benetton's Operations╩Director - a Spaniard - Joan Villadelprat actually resigning from the team only to withdraw his resignation when it became clear that the Telefonica deal was not completed. Villadelprat remains the man most likely to lead the team if it moves to Barcelona.
Juan Villalonga, the boss of Telefonica, faced some resistance to buying into the team but it seems that his recent successes have enabled him to overcome opponents on the board. He intends to use Formula 1 as part of the company's aggressive marketing drive in Europe and in Latin America where Telefonica is becoming an increasingly big player.
The team will retain the promising Marc Gene and will test another young Spanish talent Fernando Alonso this week but it is expected that the second Minardi drive will eventually go to a South American driver. The obvious choice would be current test driver Gaston Mazzacane.
It seems that there is a possibility that the influx of money will help the team to get a better supply of engines than the expected Supertec deal, with rumors last week suggesting that there is pressure on the Ford Motor Company to allow the Italians to use the engines raced this year by Stewart Grand Prix. This will mean that Ford will continue to gain some publicity in Formula 1 while the costs of the Jaguar Racing program will be offset slightly by income from Minardi. Although Ford is officially saying that it is not changing its position in F1, the deal - believed to have been proposed to Ford by F1 boss Bernie╩Ecclestone - is a logical one for Ford.
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