Written by: Keith Tully
Published: 29th September 2015
Renault announced their intention to return to Formula 1 this Monday. Their plans involve starting up once again under their own name next year and will be made possible through their takeover of the Lotus team, a deal which gave Lotus the lifeline they needed at the very last minute.
Renault asserted they had signed a letter of intent to take a controlling stake of the British-based Lotus team, who have found themselves in deep water due to unpaid taxes. Lotus is facing legal action in London due to these unpaid fees and had Renault not stepped in, Lotus would be having their future decided by a judge.
Renault released a statement which explained that the signature of their Letter of Intent marked their ‘first step towards the project of a Renault Formula 1 team from the 2016 racing season’. Lotus had previous been the Renault Formula One Team but was sold and renamed after the infamous race-fixing scandal in 2008, at the Singapore Grand Prix.
The team had previously raced under the Benetton and Renault monikers and had won many championships with both Michael Schumacher and Fernando Alonso.
In 2013 Lotus scored a respectable fourth place finish but by 2014 they were down in eighth with only 10 points to their name. Financial struggles began to overwhelm the team, as pressures from creditors and legal difficulties became more and more imminent. Notably the team found themselves locked out of the hospitality unit in Japan as they hadn’t paid the Grand Prix circuit organisers and their mechanics ended up being fed as a favour elsewhere, again due to financial problems.
It didn’t end there as at the Belgian Grand Prix, Lotus also found their cars impounded by bailiffs, due to a dispute with one creditor, Charles Pic, but this was then settled. The London court case was brought by the HMRC which is owed an astounding 2.715 million pounds in unpaid and missing income tax and national insurance payments for the months of July, August and September, with interest on top.
The High Court gave Lotus until this Monday to sort out a deal with Renault, in an attempt to satisfy creditors and keep them out of administration. A hearing on Monday confirmed a deal had been agreed and they asked for an adjournment until December 7th, to give time for the deal to be finalised and put in place officially.
Speaking on behalf of Lotus, their legal representative Tina Kyriakides asserted that they hoped to pay the HMRC this week and whilst there are further disputes in the past between the HMRC and Lotus, these amounts are less pressing and to be considered at a later date.
In 2016 we can expect the return of the Renault F1 Team and some satisfaction for Lotus’ creditors too.