Tony Fernandes has hit back in the war of words over Caterham F1 by claiming that the buyers – Swiss consortium Engavest – have not fulfilled their part of the deal.
Engavest said today that Fernandes was still responsible for Caterham F1 as he had failed to transfer the shares.
Fernandes said in a statement: “In June 2014, I decided, together with my co-shareholders, to sell my stake in the Caterham F1 team. We agreed in good faith to sell the shares to a Swiss company named ‘Engavest’ on the basis that Engavest undertook to pay all of the existing and future creditors, including the staff. The continued payment of staff and creditors was so important to me that I ensured that the shares would not be transferred to the new buyers unless they complied with this condition.
“Sadly, Engavest has failed to comply with any of the conditions in the agreement and Caterham Sports Ltd (the UK operating company of the F1 team) has had to be put into administration by the bank, with large sums owing to numerous creditors. Our agreement with Engavest was very clear: there was no legal obligation to transfer the shares to them unless certain conditions – which included paying creditors – were met. Those conditions have not been met. Our lawyers have asked Engavest several times to comply with these conditions but they have failed to engage.
“If you agree to buy a business, you must pay its bills. They have breached that promise and now, sadly, it is others such as the employees and the fans of the Caterham F1 team that will suffer if the team ceases to race. I sincerely hope that this will not be the case and that a solution can be found.”
Meanwhile Graham Macdonald, Caterham Group CEO, said: “We genuinely believed, at the time, that the sale of the team was the best route for the staff and creditors of the Company, as we felt it secured its long term future. The whole agreement with Engavest was based around a low consideration for the business, with easy payment terms so that creditors and staff could be paid.
“The buyers were made fully aware at the time of all outstanding liabilities. However, it appears to me that they never had any intention of paying these liabilities. I go on to question how anyone who was interested in the long term future of the business would appoint one of their cleaners – Constantin Cojocar – as the sole director and shareholder of the UK operating Company?
“We continue to see claims and counter claims from the F1 team which are totally unfounded. Not only have they failed to pay the creditors (and have even left our shareholders to pay some of the creditors on their behalf), but they have failed to pay us anything for use of our factory and site, or anything for the use our brand name. In short the new owners have paid us nothing and now the administrators have been appointed they want to walk away from their liabilities.”
3 responses to “Fernandes claims Caterham F1 buyers did not fulfil deal”
Tony is so concerned about his staff and the creditors that he previously refused to pay, that he is forcing the team out of business and thus screwing over his staff and creditors, despite someone stepping up and offering to (possibly) resolve the situation.
Or, if Tony transfers the shares, the staff and creditors *might* be safe. If he doesn’t, they definitely aren’t.
And what kind of businessperson can be expected to pay off a company’s debts BEFORE taking ownership of the company? Nonsense.
At least the staff know that Tony is the owner, and is so concerned about their welfare, that there is no hesitation that he will be paying the salaries this month.
Imagine if the FA had a “fit and proper person” test.
In the “Good old days” Bernie would have sorted this stuff out before it ever reached this point. So I am left thinking two things, 1) Obviously Bernie no longer involves himself in these messy things, and 2) How much longer can F1 continue under a structure that allows this to happen?
The more I read about this sad mess, the more I am reminded of the saying “Oh what a tangled web we weave when first we practice to deceive”