Still reeling from Jules Bianchi’s shocking crash at the Japanese Grand Prix less than a month ago, the Marussia F1 Team has been dealt a further blow.
The Banbury-based team’s operating company, Manor Grand Prix Racing Ltd, has joined fellow backmarker outfit Caterham in being put into administration. The team will miss this weekend’s United States Grand Prix.
“With the Marussia F1 Team now in administration, the joint administrators have assessed that, given the current financial circumstances of the Group, it is not viable for the Marussia F1 Team to participate in the next race, the 2014 Formula 1 United States Grand Prix, due to take place this weekend in Austin, Texas,” a statement from Geoff Rowley and Geoff Carton-Kelly, partners of FRP Advisory LLP, the specialist restructuring and recovery firm assigned as joint administrators of the Formula 1 team.
While the outfit may have claimed the first points’ finish in its history thanks to Bianchi’s ninth place at Monaco, that hasn’t staved off the wolves which have been circling the small team for some time. A major sign was Manor’s decision to withdraw its GP3 Series team ahead of the Russian Grand Prix round due to financial concerns, but the team’s troubles have been apparent for much longer.
The company will continue to run while the joint administrators assess its long-term viability in its current form. The administrators have confirmed that all staff have been paid through to the end of October, but their very future employment will be contingent “on whether the company can secure new investment in the limited time available.”
Heading into administration is a rescue mechanism for insolvent companies, so it would be fair to assume that at some stage the team’s entry into the Formula 1 World Championship will be cancelled. Marussia’s situation is somewhat different to Caterham’s, as the latter’s move to hand over control to the administrators stems from an ownership wrangle between its current and former owners.
A key point will be whether Marussia was actually a signatory to the 2009 Concorde Agreement when its 2010 entry as Virgin Racing was registered. It has always been run by Manor through the team’s transition into Marussia ownership, and while the rules allow for name changes and changes in primary ownership, the Agreement does not allow for the rights to be transferred between companies.
Given that Manor has run the show for the team, then it is very likely that the team’s obligations and benefits – most importantly its huge windfall as a result of finishing in the top-ten in this year’s Constructors’ Championship standings – will be terminated if Manor is deemed insolvent.
The team was rumoured to be – along with Sauber – courting Canadian fashion mogul Lawrence Stroll as a potential investor, but little has been heard of Stroll’s ongoing interest since September.
The news puts Formula 1 in a terrible position, and the expected demise of both Caterham and Marussia will be another tragic mark on the FIA and the bigger teams’ inability and unwillingness to agree to sensible cost-capping and a more equitable slice of the sport’s commercial revenue.
Image via XPB Images
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