deal

The Russian team will appear in Formula 1 this spring. This was made possible thanks to the Midland Group's purchase of the British Jordan team last weekend.

Initially, the start of the Russian team under the Midland F1 brand was planned only for next year. Such a delay was quite reasonable, given that the “stable” was supposed to be created from scratch. It was necessary to hire employees, decide on management, drivers and, finally, create a car. The latter was entrusted to Dallara, a well-known company in the racing world. However, the chairman of the board of directors of Midland Group, Alex Schneider, said back in December (see Kommersant on December 15, 2004) that he was considering the possibility of early entry into Formula 1 by purchasing one of the teams available in the championship.

Alexander Schneider was born on August 3, 1968 in Leningrad (father is an engineer, mother is a dentist). In 1972, he went to Israel with his parents, and in 1982 he moved to Canada (Toronto). In 1992, he graduated from York University in Toronto with a bachelor's degree in economics. After graduating from university, he went into business. In 1993, he co-founded and headed the transnational corporation Midland Resources Holding Ltd (Midland Group). Married.

Midland Group is registered in the British offshore Guernsey (Channel Islands), and its head office is in Toronto. It has representative offices in 34 countries. Average annual income is about $2 billion. Midland Group owns stakes in the Ukrainian companies Zaporizhstal (42%) and Zaporozhkoks (33%), the Volgograd metallurgical plant "Red October" (100%), distribution energy networks of Armenia (CJSC "Armenian Energy Networks" - 80%), Montenegrin steel company Niksic. In 2003, the holding's enterprises produced about 4 million tons of ferrous metals. In Moscow, Midland Group owns the advertising agency M Media Group.

At first there was talk of acquiring Jaguar, but Mr. Schneider was not satisfied with the terms of the deal. And then the Jordan option appeared. Fortunately, the owner and founder of the team, Eddie Jordan, had been looking for new sources of financing for a long time, and generally without much success, that would allow Jordan to regain lost ground. In order to save the team, which found itself in a severe financial crisis, he was even ready to lose his status as the main one in it.

In general, this was exactly the case when both parties were almost maximally interested in concluding a deal. Alex Schneider, naturally, needed the developments that Jordan had over almost 15 years of performances in Formula 1, and Eddie Jordan needed to get out of business with minimal losses.

Negotiations went on for several weeks, and the contract was signed on the night from Friday to Saturday in London. According to it, Midland Group becomes the owner of 100% of Jordan shares. The parties do not comment on the cost of the transaction, but, according to Kommersant's information, it is approximately $50 million. The amount is not accidental. The fact is that the entry fee for a new team to appear in Formula 1 is $48 million - this is exactly how much Midland F1 would have to pay if it started in 2006.

Selling Jordan does not mean Eddie Jordan is leaving the team. It will retain some features. Mostly they will be related to working with existing sponsors. As for finding new partners, they will be dealt with by a new team of managers. Exactly the one that was assembled to drive the Midland F1. “Now the time has come to start looking for partners, in particular, among large Russian companies. We already have something to offer them,” said Midland F1 managing partner for Russia Alexander Radunsky in an interview with Kommersant. “Perhaps we will even open a second office in Moscow, although the team will be based in Silverstone. And it’s not just about attracting business partners. We are also interested in the scientific potential available in Russia, for example, the experience accumulated by Russian specialists in the field of aerodynamics."

But it should still be noted that changes in Jordan that are noticeable to the average fan will not yet occur. The team will not change its name or corporate colors. This will happen only next year. Alex Schneider thought it best not to make any sudden moves and let Dallara finish the job of creating a new car. And within a year, Jordan and Midland F1 will be merged into one asset. Then the team will receive a new name.

It’s still not clear who will race for Jordan in the new season. According to Alexander Radunsky, this issue remains to be sorted out.

As for the team’s budget under the new owners, it will most likely range from $100 million to $150 million. At least, Alex Schneider expressed his readiness to spend exactly this amount per year in an interview with Kommersant. Considering Jordan's budget was approximately $75 million last year, the increase is significant.

AFSATI Kommersant-JUSOYTI

Russia fits into the "Formula"