SEPTEMBER 25, 2000

Prost confirms Ferrari deal

AS we have been predicting for some weeks, Prost Grand Prix will use Ferrari engines next year and in 2002. The deal is believed to be costing Alain Prost something in the region of $60m for two years. It remains to be seen who will be paying for the engine deal but the team says that the Ferrari V10s will not be called Ferrari and will carry the name of a sponsor, in a deal similar to that enjoyed in recent years by Sauber Petronas. The Ferrari deal is only for the engine and does not include gearboxes.

"It is an important decision," said Ferrari's Jean Todt. " We are opening a completely new shop, completely independent from Scuderia Ferrari, which will be in sole charge of supplying engines for our two clients. In terms of supply, the engines will be one year behind the one we are using during the season." Todt admitted that the money is important income for Ferrari.

Prost said that the engine deal has given him new motivation and that he is not going to give up. "No matter what happens," he said. "I will remain as team principal."

Alain admitted that the engine deal is expensive but it means that the team can be much more competitive and that will make it easier for him to run the team.

There is no doubt that Prost is selling at least some of the shares in the team and it now seems that a planned deal involving the Lehman Brothers investment banking firm is not going to happen. There is also doubt over whether Prost parted with any shares as part of a marketing deal he announced with UFA Sports, a subsidiary of the giant Bertelsmann media company. What is clear is that last October Prost sold 10% of the team's holding company to Louis Vuitton Moet Hennessy. In recent weeks there have been many names mentioned as possible buyers for Prost shares, notably Umelio Diniz, the father of Sauber driver Pedro, who is one of the wealthiest men in South America. There have been suggestions that Diniz Sr. agreed to buy a shareholding to pay for the engines. Paying out $60m would entitle Diniz to around 40% of the team, given the valuation when the LVMH deal was done.

At the same time we continue to hear that Prost is close to a deal with a group of Indonesian and Singapore investors and it may be significant that the Prost Formula 3000 team recently tested Australian racing sensation Christian Murchison. The 19-year-old Melbourne based driver has shown impressive pace in Formula Holden in Australia but has strong links with Singapore.

In terms of sponsorships, Prost is trying very hard to do a deal with Telefonica but the Spanish telephone company is insisting that the team takes on Marc Gene and with Jean Alesi signed up already and Diniz a likely second driver there is not much chance for Gene. It might be possible for Prost to convince Telefonica to do a secondary deal (in addition the Minardi sponsorship) and have Fernando Alonso or even Oriol Servia as a test driver with a full deal with Telefonica in 2002.