The administrators of the company behind the defunct Manor F1 team have blamed the loss of 10th place in the 2016 championship for its demise – and say that time wasters dragged out the process of trying to save it.
Official papers submitted by FRP Advisory have provided more detail about the problems of Just Racing Services Ltd, the company that provided R&D services and everything associated with running the Manor cars after Stephen Fitzpatrick took over at the start of 2015.
The administrators claim that 50 parties indicated an interest in the team, which encouraged the payment of £600,000 on January wages in attempt to buy time to find a solution. However, in the end none was forthcoming.
As a result, some £3m is owed to creditors, including many small suppliers and one-man businesses who were hit badly by the previous failures of Marussia and Caterham.
The actual F1 entry and the contracts with principal suppliers such as Mercedes and Williams are still held by sister company Manor Grand Prix Racing Ltd, which is not in administration.
The matter is further complicated by both JRS and MGRS being part of a third holding company, Just Racing Ltd. All three entities are 100 percent owned by Stephen Fitzpatrick.
FRP confirms that Fitzpatrick was in talks about selling the group before the end of the season, and that they had reached an "advanced stage."
However, the Brazilian GP – where Sauber moved into 10th place – proved to be critical.
"Following the end of the 2016 season, it was apparent that the reduced prize money to be received during the 2017 season was a significant hindering factor in attracting the new investors," FRP Advisory said.
That led to JRS going into administration on January 6, "whilst discussions with an investor continued daily."
Nearly 50 interested parties
The administrators had talks with many potential saviours, having made the ground rules clear.
"The net funding requirement for the team for the 2017 season was £43m (which excludes any income which could be achieved from driver income and sponsorship). Interested parties were advised of this requirement.
"It had discussions with approximately 50 interested parties but none were able to provide sufficient comfort that they had the cash resources to enable the company to return to solvency.
"The request to interested parties was to demonstrate the immediate availability of £5m with a supporting business plan to show how the 2017 year would be funded."
In an unsubtle dig at the motor sport business, FRP adds: "Dealing with interested parties has been time consuming due to the nature of the sport and those people involved in it.
"A number of parties occupied significant administrator time but were unable to demonstrate that they have access to the cash resources to take the team forward.
"Despite every opportunity afforded to interested parties, none could provide a credible solution to the insolvency of the company."
FRP confirms that £600,000 was paid to JRS by MGPR to cover January wages, and maintain the possibility of saving the team.
The extra time also allowed continuing development of the 2017 car "so far as possible," while also pursuing a contingency plan with "for a compliant modified 2016 car."
With no investor found and no budget for the February wages, 150 employees were made redundant on January 31, with a skeleton staff kept on to help with the administration process and to keep alive the "slim possibility" that an investor could still be found.
Emphasising the complex nature of the trio of companies behind the team FRP says it is "currently investigating whether the racing car chassis are owned by MGPR or the company," and also "whether an intra-company recharge should be applied between MGPR and JRS. This could result in an increase in unsecured creditors by £34m."
In other words, MGPR "could be due approximately £34m."
The administrators also note that "the failure of JRS could also result in the potential insolvency of MGPR and Just Racing Ltd."
At the moment, total creditors are listed as £10m, of which nearly £7m is owed to holding company Just Racing Ltd. The remaining £3m is due to third party creditors.
Mercedes-Benz Grand Prix Ltd, which as noted has a contract with MGPR, is named as a secured creditor, and is owed "approximately £238,000."
Aside from Just Racing Ltd and Mercedes the most significant individual amounts owed include NTT Data Services (£351,927), HMRC (the UK tax authority - £340,177), Travel Places (£270,001), Freeman's Hospitality (£150,000), DHL (£108,930), Delta Preg (£66,494), HSL (£67,201) and Global Technologies Racing (£51,776).
The administrators say that cash in the bank is £1.62m, while the physical assets will go to auction. Total assets are estimated at £2.47m.