Sahara Group to buy stake in Force India F1

Force India

Dr. Vijay Mallya, co-owner of Force India F1 Team, has sold some stake in the team to Sahara Group, the reports from Indian media claim. Reports also add that an agreement of the Force India stake-sell will soon be confirmed officially, although, no comments have been obtained at present from both parties.

The Force India F1 Team was formed in 2007 with a purchase of Spyker-Ferrari team by a consortium led by Mallya and Michiel Mol, a Dutch entrepreneur.

The Force India stake-sell reports were rumored during the Japanese grand prix weekend and Vijay Mallya made efforts to reject rumours about a sale of stake in the team.

The reports were speculated following debts of Mallya’s low-cost airline, Kingfisher Red, which has lost a lot of money. The airlines is in debt of $1.5 bn. The Kingfisher Red has faced decline in passengers as the yearly audit says during April 2007 to March 2008 12.4 million passengers flew with the airline and in same period of 2008-2009 only 10.8 million passengers board the flights. Though during first quarters of 2011 passenger number has increased but that is not enough to compete in the market with Spicejet and Indigo. So, the airlines management is firm on exiting low-cost sector and running only Kingfisher airlines in premium sector.

The Sahara group is the biggest supporter of the sports in India with title sponsorships to Indian cricket team and Indian hockey team. The group’s main interests stands with financial services, city development, print and television media, film production, sports, information technology, health care, tourism, hospitality and consumerproducts.

The reports are also claiming that the purchase of a stake in the team will completely bought-out in future and the change of ownership will not happen until 2013.