Vijay Mallya Bids For Spyker-Ferrari Formula 1 Team

Vijay Mallya and Michiel Mol Director of Formula One for Spyker have teamed up to make a 80 million euro (54 million pounds) bid for the cash-strapped team. In a joint statement, the two said,

"This offer has been accepted by the Board of Spyker Cars N.V. and exclusivity has been granted to the consortium Orange India Holdings Sarl to proceed with due diligence ... to achieve completion within 30 days,"

Vijay Mallya had said last week that he was actively pursuing a purchase and it appears that this has come to fruition.

The ex-Jordan F-1 team is one of the most interesting teams in the Paddock. Over the last 16 years the team have won 4 races. Micheal Schumacher made his debut with this team way back in 1991. Other notable drivers include Heinz Herald Frentzen, Fisichella, Damon Hill, Barrichello, Trulli and Eddi Irvine. However, the team is in dire straits now having had 3 owners during the last 2 years (Jordan, Midlands and Spyker). They are still to win a point in the 2007 season.

This is the first entry of an Indian team into F-1, and the third Asian team It appears that we have beaten the Chinese on this one.

Managing finances for a team like Spyker will be a massive challenge. Their main engine suppliers are Ferrari and without the factory backing of Spyker one wonders how Mallya plans to run the team

With easy credit drying up, one needs to see how long Mr Mallya will hold on to the team considering the fact that he will see very little success atleast in the next 2 years.

Adrian Sutil and Christian Albers are the current drivers. Will our man Narain get another opportunity to drive for his ex-Team? The odds are low but one can never tell

All in all, in the short run, this is a good development at least from a Brand Equity Perspective. The Kingfisher brand will be all over the world. This may also mean a Beer and Airlines launch in the UK and Europe. The synergies are clearly there. However, considering the cost of running such a business, it does not appear to be a long term investment. Only time will tell.