McLaren figurehead Ron Dennis has been ousted from his role as chairman and CEO of the McLaren Technology Group by the company’s fellow shareholders.
The Englishman had been fighting to hold on to his position for several weeks, with claims by fellow board members that the Grand Prix outfit’s continued poor performances were impacting the reputation of the McLaren group as a whole.
Dennis was quick to release a defiant statement confirming he had been forced out of his role, although he will still retain his 25 per cent shareholding and positions on the McLaren board – for now at least.
“I am disappointed that the representatives of TAG and Mumtalakat, the other main shareholders in McLaren, have forced through this decision to place me on gardening leave, despite the strong warnings from the rest at the management team about the potential consequences of their actions on the business,” Dennis’ statement reads.
“The grounds they have stated are entirely spurious; my management style is the same as it has always been and is one that has enabled McLaren to become an automotive and technology group that has won 20 Formula 1 world championships and grown into an £850 million a year business.
“Throughout that time I have worked closely with a series of talented colleagues to keep McLaren at the cutting edge of technology, to whom I will always be extremely grateful.
“Ultimately it has become clear to me through this process that neither TAG nor Mumtalakat share my vision for McLaren and its true growth potential.”
Dennis’ statement was quickly followed by a press release from McLaren, which confirmed:
“As of this afternoon Ron Dennis no longer holds the position of Chief Executive Officer of McLaren Technology Group (or its subsidiaries). However, he remains a shareholder and a director of McLaren Technology Group.
“Over the past 35 years Ron’s contribution to the success of McLaren has been colossal. During his tenure the team won 17 World Championships and 158 Grands Prix, making him the most successful leader in Formula 1 history.
“Like the company’s founder, Bruce McLaren, Ron is and will always be one of the true greats of the sport.
“McLaren Technology Group is now in the process of seeking a new Chief Executive Officer. Until such an appointment has been made, the company will be run on an interim basis by an Executive Committee comprising the Group’s majority shareholders, in close collaboration with the Board of Directors and the senior management team, all of whom remain utterly committed to the company, its partners, its employees and its fans, and share a passionate determination to build on our many strengths towards future prosperity.”
While the discrepancy between Dennis’ claimed 20 titles and McLaren’s stated 17 (due to three of its Championship crowns being earned before Dennis took control of the team in 1980), the fact remains that the team’s championship-winning form has almost deserted it. Apart from Lewis Hamilton’s Drivers’ Championship success in 2008, all of the team’s titles won under Dennis’ leadership occurred between 1984 and 1999.
After entering Formula 1 as a mechanic with the Cooper team in 1966 at the age of 18, he worked alongside Jochen Rindt and followed the Austrian driver when he switched to Brabham in 1968. Dennis remained at Brabham until the retirement of its team founder, Jack Brabham, and along with his colleague Neil Trundle, the pair set up Rondel Racing.
The privateer outfit was enjoying considerable success in Formula Two by the mid-1970s. Plans to enter Formula 1 in 1974 fell through, but he regrouped and founded Project Four Racing (where the ‘P4’ moniker is derived in McLaren’s F1 chassis and road car models), where it won championships in Formula 3 and Formula 2 with Marlboro backing.
Ron Dennis at McLaren – Part 1
Aspiring to return to Formula 1, Dennis teamed up with acclaimed designer John Barnard to develop an innovative new car design.
His return to F1 was well-timed. Marlboro was also backing the McLaren team, but the outfit had endured a disastrous 1980 campaign and so the cigarette giant insisted on Dennis being slotted into run the team, merging McLaren and Project Four together.
The new company, McLaren International, was formed with a mix of shareholders from the old and new guard, although Dennis subsequently acquired 100% by 1983 and then sold half to the TAG group and its Saudi Arabian boss Mansour Ojjeh who had funded the team’s Porsche-built turbo engines that were now propelling it to its former championship-winning glory.
The TAG-branded engines left the scene after 1987 when McLaren started a new period of dominance with Honda turbo engines in 1988 – winning 15 of the year’s 16 races in a crushing display – and continued until 2000 when Daimler AG (the parent company of Mercedes-Benz, the team’s engine supplier since 1995) exercised an option to purchase a 40% stake. Dennis and Ojjeh sold a 20% shareholding apiece.
Despite speculation that Daimler would increase its stake to 60% in 2006, the following year Mumtalakat, a new holding company owned by the Bahrain government, bought half of the shareholding still owned by Dennis and Ojjeh. While Daimler and Mumtalakat had 70% between them, the latter was locked into a voting alliance with Ojjeh and Dennis, which still meant Dennis had control.
When the Brawn GP team rose from the ashes of the Honda works team and beat fellow Mercedes runners McLaren to the title in 2009, Daimler decided to leave McLaren and buy Brawn to create a factory Mercedes-Benz team. Dennis, Ojjeh and Mumtalakat bought back Daimler’s 40% shareholding, with half going to the Bahrainis and the remainder split between Dennis and Ojjeh.
McLaren also separated its road car operation from the racing team, and in the wake of the fallout from the 2007 SpyGate scandal and the team’s faltering performance, Dennis stepped away to support the car business and left the running of the F1 team to his deputy and chosen successor, Martin Whitmarsh.
Ron Dennis at McLaren – Part 2
The racing team struggled on as a now customer outfit of Mercedes – crucially losing its title sponsorship from Vodafone – and in 2014 Dennis had Ojjeh side with him to force a shareholder revolt to oust Whitmarsh as Team Principal.
He promised a buyback of the Formula 1 team, increased investment through new lucrative sponsorships and a return to former glory with a renewed partnership with Honda.
The team’s performance has floundered with poor chassis and underperforming Honda power units, prompting a flood of departures of long-term sponsors – including Hugo Boss, Diageo and (at year-end) Exxon Mobil – who have refused Dennis’ commercial terms. There were even rumours that Apple was an interested buyer, but the deal didn’t go far.
It would seem that Mumtalakat and Ojjeh finally ran out of patience.
Dennis’ legacy and the road ahead
It is the end of an era. A curious figure in the paddock with a reputation for obsessive fastidiousness and a laborious style of communication dubbed ‘Ronspeak’, Dennis was nonetheless a brilliant and inspirational leader of the company who deserves more recognition that he has achieved to-date.
To the remaining majority shareholders, Dennis is no longer the man for the job at the top. The outcome has been a public and ugly divorce, hardly a fair reflection of one of the accomplished figures the sport has ever produced.
Image via Top Car
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