Ron Dennis has been forced out of the McLaren after a long, tense boardroom battle between his long time business partner Mansour Ojjeh and Bahraini sovereign wealth fund Mumtalakat.
Dennis owns 25% of McLaren Group and Ojjeh another 25%. Mumtalakat owns the remaining 50%. Behind the scenes a tense battle has been raging between Dennis, Ojjeh and Mumtalakat with Dennis trying to raise money to buy out Ojjeh to increase his stake in the business.
Last week, a £1.65 Billion bid from a Chinese consortium was rejected by Ojjeh and Multalakat after which they launched their own counter against Dennis to remove him as CEO and Chairman of McLaren Technology Group.
Dennis tried to bring forward a court order to prevent this but the courts did not grant the order. He will now be placed on gardening leave till his contract expires at the end of the year.
Dennis will remain involved in McLaren as he will still be on the board of McLaren Technology Group and McLaren Automotive Ltd but he will no longer be involved in the day-to-day running of the operation.
“l 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 of the management team about the potential consequences of their actions on the business,” said Dennis in a statement.
“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 One 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. But my first concern is to the business I have built and to its 3,500 employees. I will continue to use my significant shareholding in both companies and my seats on both boards to protect the interests and value of McLaren and help shape its future.
On his future plans, Dennis says he will launch a technology investment fun once his contract at McLaren expires at the end of the year.
“In addition I intend to launch a new technology investment fund once my contractual commitments with McLaren expire. This will capitalise on my expertise, my financial resources, together with external investment to pursue the many commercial opportunities I have been offered in recent years but have been unable to take up while
being so committed to the existing business. ”
In a separate statement from McLaren, they made it clear that while Dennis will be on gardening leave he will remain as CEO although he has relinquished his role as CEO. McLaren also say that they are currently seeking a new CEO. Management of the organisation, in the interim, will consist of an Executive Committee comprising the Group’s majority shareholders, collaboration with the Board of Directors and the senior management team.
“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,” read the statement from McLaren.
“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,” the statement continued.
“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.”