Toto Wolff, the architect behind one of the most dominant eras in Formula 1 history, is in advanced negotiations to sell a portion of his stake in the Mercedes-AMG Petronas F1 Team. The deal, which is reportedly in its final stages, would value the team at a record-breaking £4.6 billion ($6 billion), underscoring the meteoric financial growth of Formula 1. Despite the sale, Wolff is set to continue in his leadership role as Team Principal and CEO. (1,3)
The Landmark Deal
Sources have confirmed that Wolff is looking to sell a « mid-single-digit stake » of his personal holdings. (1) Specifically, reports indicate the sale would be equivalent to approximately 5% of the entire team, reducing Wolff’s personal share from 33.3% to around 28.3%. 2 The team’s current ownership is an equal three-way split between Wolff, parent company Mercedes-Benz, and the chemicals giant INEOS, which is headed by Sir Jim Ratcliffe. (2)
The potential buyer has been identified as George Kurtz, the American entrepreneur who is the co-founder and CEO of the cybersecurity firm CrowdStrike. Kurtz is no stranger to the Mercedes team, as CrowdStrike has been a prominent sponsor since 2019. An avid sportscar racer himself, Kurtz’s potential investment signals a deeper commitment to the team. (2)
In response to the reports, a Mercedes spokesperson stated, « The governance of the team will remain unchanged, and all three partners (Mercedes-Benz, Toto and INEOS) are fully committed to the ongoing success of Mercedes-Benz in Formula One. » (1,2)
A New Benchmark for F1 Valuations
The proposed $6 billion valuation sets a new, unprecedented benchmark for a Formula 1 team. It significantly surpasses the recent valuation of rival team McLaren, which was pegged at around £3.5 billion ($4.7 billion) following a change in its ownership structure in September. 3 This remarkable figure highlights the soaring value of F1 franchises, a trend fueled by the sport’s expanding global audience and commercial success.
The growth is staggering when compared to INEOS’s initial investment in 2022, when it purchased its one-third stake for £208 million. 3 The team’s financial health is robust, with Mercedes F1 reporting an increased revenue of £636 million ($858 million) for the 2024 financial year, which included a profit of £120.3 million ($161 million). (2)
The Context of F1’s Boom
Formula 1’s recent surge in popularity can be attributed to several factors, most notably the success of the Netflix docuseries Drive to Survive. As Wolff himself noted, the show brought in a new, younger audience and re-engaged existing fans, particularly during the global lockdowns. (2)
« COVID hit, people were at home and Drive to Survive dropped. Younger audiences connected with their parents and grandparents around Formula 1, » Wolff said at a recent business exchange. « And we’ve continued to grow, but we have to be wary, because fundamentally, we need to deliver credible sport. If that continues, the other KPIs will perform positively. » (2)
This growth has been mirrored in other media, such as the success of the Brad Pitt-starring F1 movie released last summer, which became the most successful sports movie of all time. (3) This mainstream appeal has transformed F1 teams from being mere sporting entities into highly lucrative investment opportunities.
Under Wolff’s leadership since 2013, Mercedes has enjoyed a period of unparalleled success, securing eight consecutive constructors’ championships and seven drivers’ titles between 2014 and 2021. (3) This partial sale allows Wolff to capitalize on the team’s immense valuation while remaining at the helm, guiding the team into the next era of Formula 1.
References
[1] ESPN: Toto Wolff in talks to sell stake valuing Mercedes at $6bn – sources
[2] Motorsport.com: Toto Wolff in talks to sell some Mercedes F1 shares, valuing team at $6bn
[3] BBC Sport: Mercedes: Toto Wolff set to sell stake in deal which values F1 team at £4.6bn