Sahara's Force India stake looks a hard sell
By Alan Baldwin and Sumeet Chatterjee
LONDON/MUMBAI (Reuters) - India's embattled Sahara conglomerate said it wants to sell its 42.5 percent stake in the Force India Formula One team to help release founder Subrata Roy from jail, but some motor racing insiders are skeptical about how easy it will be to find a buyer.
Sahara, which paid $100 million for the shareholding in 2011, sought the Indian Supreme Court's permission this month to dispose of Force India and other assets to raise a combined 53 billion Indian rupees ($778.38 million)
However, former Jordan, Jaguar and Red Bull marketing executive Mark Gallagher said such a sale would not be easy.
"I don’t think anybody will pay 100 million pounds, euros or dollars for 42.5 percent of a mid-level F1 franchise," Gallagher told Reuters.
Others said it would be easier to dispose of the stake if the whole team - run by beer baron Vijay Mallya who also owns 42.5 percent - were up for sale because a buyer would want outright control.
With Formula One far less popular than cricket in India, and Mallya under pressure from lenders to meet loan repayment obligations linked to his grounded Kingfisher Airlines, the stake on its own could be a hard sell.
Lenders who are owed more than $1 billion by Kingfisher have started putting up for sale some of the carrier's assets. Kingfisher has not flown since 2012 due to a lack of cash.
"Unless you are just doing it for sponsorship, I imagine you would want control. And generally sponsors don’t want to be shareholders," Finbarr O'Connell, administrator for the failed Caterham team, told Reuters. Continued...