Williams terminates ROKiT deal with sale of team on the cards
The Williams Formula 1 team has today announced an early end to its title sponsorship deal with ROKiT, the UK-based telecoms company.
The move, which takes effect immediately, is part of a “new strategic direction” which could also lead to the sale of the team after it revealed a significant loss for the 2019 financial year.
ROKiT became Williams’ title sponsor ahead of the 2019 season in a deal that was due to run until 2023 and worth around $25 million per year.
The telecoms firm replaced Martini, the spirits brand that was closely associated with Formula 1, but ended its five-year agreement with the British team, and withdrew from the sport altogether, at the end of 2018.
The team has also ended its sponsorship agreement with ROK Drinks, the telecoms company’s drinks brand.
This represents the end of another major sponsorship for Williams after Rexona, the deodorant brand owned by Unilever, cancelled its deal with the team earlier this year.
The team’s financial results for last year showed revenue of £95.4 million ($117.4 million), down from £130.7 million in 2018.
Williams is now understood to be considering selling the team and the entire company which is a notable shift in policy as founder Frank Williams has always typically insisted on retaining full control.
The team told the BBC it is already in "preliminary discussions with a small number of potential investors" which could result in a whole or partial sale.
Williams have finished bottom of the Formula 1 constructors' world championship for the last two years.
Mike O’Driscoll, chief executive officer, said: “The financial results for 2019 reflect the recent decline in competitiveness of the F1 operation and the consequent reduction in commercial rights income”
“After four years of very solid performance in the Constructors’ Championship during which we claimed two third and two fifth place finishes, we endured a couple of very difficult seasons. We have implemented a significant restructuring over the last nine months and have strengthened the technical leadership team.”
“The 2020 Formula 1 season has, of course, been disrupted due to the Covid-19 pandemic, and this will have an impact on our commercial rights income this year. The Team have also served notice to terminate its relationship with its title partner, ROKiT, and major sponsor, ROK Drinks.
“In common with many other businesses, we have taken extensive action to mitigate, including a prolonged furlough period for much of our staff.”
However, O’Driscoll is confident that Williams’ long-term prospects will receive a significant boost with the impending budget cap, which has been set at $145 million for the 2021 season.
He added: “There has been an enormous gap in earnings and expenditure between the three largest teams and the rest of the grid for a number of years. But we are confident that [Formula 1 owner] Liberty Media’s long-term vision and plans, including a first-ever cost-cap for the sport, will deliver a more level playing field for 2021 and beyond, on which all teams can compete more fairly.”
Meanwhile, the Silverstone circuit in the UK is expected to host back-to-back grands prix behind closed doors next month.
Formula 1 will unveil its revised calendar next week, which will include the British Grand Prix as part of the opening eight European races of the season.
Silverstone is set to stage consecutive races on 2 and 9 August under an agreement with Formula 1 but the calendar will only be finalised once the UK government provides clarity on travel restrictions.
The delayed season is due to begin with two races in Austria, with the first on 5 July, with the initial plan for Silverstone to follow with two meetings but the government’s 14-day quarantine policy on entry into the UK has placed some doubt over this.
As a result, the Hungarian Grand Prix in Budapest is now expected to be the third race on the calendar on 19 July after the season kicks off in Austria.
After Silverstone, Spain (Barcelona) will then kick off a trio of races from August to September, with Belgium (Spa-Francorchamps) and Italy (Monza) to follow.
Hockenheim will continue to be a backup option should Formula 1 be unable to race in the UK.
The Dutch Grand Prix, however, has been cancelled and must wait until 2021 to make its long-awaited return to the sport’s calendar.
The race at Zandvoort was set to make a return this year for the first time since 1985. The grand prix was due to be held on 3 May but was postponed because of the pandemic.
Dutch Grand Prix sports director Jan Lammers said they held talks with Formula 1 about the possibility of staging the race without spectators but ultimately decided against it.
In other developments, Formula 1 teams will be limited to a maximum of 80 staff members each at races held without fans when the season eventually resumes.
The conditions have been put in place by the FIA, motor racing’s international governing body, as part of its revised 2020 sporting regulations around 'closed events'.
The FIA’s rules state: "From the start of a closed event until the declaration of the official classification of the race, no competitor may have more than a total of 80 team personnel within the confines of the circuit. No more than 60 of these team personnel who are within the confines of the circuit may be associated in any way with the operation of the cars."
The FIA outlined that staff whose duties were solely connected with hospitality, sponsors, marketing, public relations, security or driving trucks to and from the event were not considered operational personnel.