Currently reading: McLaren takes legal action in bid to secure 'urgent' funding
Firm files court case against investors in bid to secure funding to cope with 'severe' blow of pandemic
James Attwood, digital editor
News
2 mins read
23 June 2020

McLaren has taken legal action against a group of creditors to allow it to go ahead with an “urgent” round of refinancing.

The British company, which includes the sports car maker and the Formula 1 team, is seeking to raise cash to avoid what it says in the filing is a potential “liquidity shortfall”. It said this was caused by it having “fallen into severe and unexpected financial difficulty" due to the ongoing coronavirus pandemic.

McLaren Holdings Limited is seeking to secure capital by issuing a bond for more than £650 million against its factory in Woking, Surrey and its collection of historic racing cars. But a group of investors claim that the McLaren Technology Centre and car collection are already employed as security in a bond dating from 2017.

Last week, Judge Anthony Mann agreed to expedite the trial, given McLaren’s claim that it risks insolvency if the dispute isn't settled quickly. The two sides have proposed a two- or three-day trial that will begin in 2 July.

The investors are understood to perceive the new bond issue as undermining their existing investment so have proposed an alternative refinancing arrangement.

The court documents filed by McLaren Group said that an earlier credit agreement of £130m is “fully drawn”. They also said that McLaren’s shareholders had invested a further £291m in the business in March, part of a £500m total investment in the past 18 months. 

McLaren Group recently announced plans to shed 1200 jobs across its Automotive, Racing and Applied divisions as part of a major cost-saving programme. 

READ MORE

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Comments
18

23 June 2020

Will they make it to the first race let alone the end of the season, this sounds serious.

24 June 2020

You have a British company making the finest supercars in the world, sexy, bespoke, hand-built carbon fibre engineering marvels, and you have british 'motoring enthusiasts' slagging them off?  If this was an Aussie company - I can only dream - in this situation, half the nation would be rallying behind them.

Best of luck to McLaren and their employees - the world needs you!

23 June 2020

What ?  British management rush out a string of models which garner a reputation for catastrophic depreciation and equally as poor customer service in some parts of its dealer network and, surprise, surprise, find themselves in dire economic straits ?  Shurely shome mishtake ? 

I guess it'll (deservedly) wind up in the hands of German management...just like Aston. When will people learn if you want to build a brand you "get the Germans in" ...like Schreyer and Bierman at Hyundai/Kia.... Ho hum. I feel sorry for the investors.

23 June 2020

Wot? not enough idiot footballers and arabs around tobuy this over-rated unreliable toy- you gotta laugh

 

23 June 2020

 I think there's going to be a few feeling stretched at the moment, how, or when Boris &Co. will get there act together nobody knows.

23 June 2020

They were in trouble before this pandemic. Tesla roadster 2 will wipe the floor walls and ceiling with the McLaren 

 

23 June 2020

UK engineering and management culture needs a real shake-up.  We are rarely at the forefront of any sector and seem more interested in grifting foreign investors for 'high end' vanity projects that contribute nothing to society.  I would far rather read how soon to be empty plants like Honda Swindon can be used to make vehicles/products that will improve the lives of the general populace , both in this country and for export.

23 June 2020

Absolutely agree with you. Dining on ashes is all these legacy car makers seem to do and boast about. We need Elon musk to buy that moribund Swindon's plant and drag the dinosaurs into the 21st century and fast. My fear is that he wont as there are too many buggy whip idiots still alive.

23 June 2020

I really don't understand this. Why is there so much hatred of anything British on here?

23 June 2020

It isn't hatred, it is concern that we need to get better and more relevant to compete on the world stage.

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