Arctos Partners invests in Aston Martin F1, putting the team value at $1BN

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Throughout professional sports, we’ve seen the multi-club method, a business venture where one person or entity invests in multiple sports teams, sometimes multiple in the same league, triumph or end in outright disaster.

For example, City Football Group have seen their teams win championships on multiple continents, as Manchester City won the treble of the Premier League, FA Cup and Champions League last year, and NYCFC won the MLS cup in 2021.

As well, USA-based Fenway Sports Group have seen their majority stakes in the baseball’s Boston Red Sox and football’s FC Liverpool have each seen them win championships in their respective sports.

Even then, Harris Blitzer Sports and Entertainment have seen their teams, hockey’s New Jersey Devils, and basketball’s Philadelphia 76ers, become title contenders after their investment.

However, when the venture does not pan out, it turns out to be disastrous for all parties involved, and their fans. For example, Olympique Lyonnais’ downfall under owner John Textor has seen the once-great team, who won 7-straight Ligue 1 titles in this century, now at the bottom of League 1, risking relegation, and have only won once this season.

This new style of ownership recently made its first appearance in Formula 1 just a few months ago. When Alpine announced new investment from a list of celebrets that included, amongst them, Ryan Reynolds and McElhenny. As is famously seen in documentaries and social media, both of them own Wrexham FC, a third-division team in Wales. Patrick Mahomes, an American football quarterback and new investor in Alpine, is also a part-owner of baseball’s Kansas City Royals and soccer’s Sporting Kansas City.

Now, it seems that with the investment in Alpine paying off for everyone, another F1 team has taken additional investment from a multi-club firm.

Photo Credit: Aston Martin Cognizant Aramco Formula One Team

Aston Martin announced today that they’ve made Arctos Partners, an American-based sports investment firm, a minority shareholder of their team. While the amount of money they’ve invested, even though the amount has not been disclosed yet, the amount is said to value the team at over USD $1 billion, making it one of the most expensive teams in F1. This will be Arctos’ second European investment, as they are a minority owner in Liverpool FC.

While the team brings a lot of experience in sports management, as they boast tens of minority stakes in sports teams across all major sports leagues in North America, their lack of European knowledge brings them into a position where this investment could flourish or fail by joining in Lawrence Stroll’s business partnership.

Stroll said the following regarding the new investment in his team: “Arctos see the potential and value of this project as we continue to build a world-class Formula One® team. They share our vision for our ultra-luxury brand, and they are extremely passionate about the sport and its prospects. We are investing in infrastructure, people and processes, and this is the perfect time to add strength in depth with the operational expertise and strategic experience of Arctos. Together, we will continue to drive this team forward and build an even brighter and successful future.”

Doc O’Connor, Managing Partner, Arctos Partners, said:

“We look forward to collaborating with Aston Martin Aramco Cognizant Formula One® Team and view the opportunity as the beginning of a long-term partnership with Lawrence and the entire organisation. This investment is consistent with our firm’s strategy, which focuses on backing leading sports brands across North America and Europe. We will provide extensive resources to enhance Aston Martin Aramco Cognizant Formula One® Team’s reach and brand, including industry intelligence sourced from our proprietary quantitative research and data science platform. Aston Martin Aramco Cognizant Formula One® Team is a leading name in Formula One®, one of the fastest growing sports in the US, and we are truly excited to be entering the sport alongside Lawrence and his team.”

Actros are no strangers to the multi-club method method. However, their ownership has led to multiple championships across all leagues, most of which are recent.

For example, in the last 5 years, the firm has seen 3 of its teams win the World Series in Baseball (Houston Astros in 2022, Los Angeles Dodgers in 2020 and Boston Red Sox in 2018), hockey’s Tampa Bay Lightning win the Stanley Cup in 2020 and 2021, and basketball’s Golden State Warriors win the NBA Championship in 2018 and 2022, while Liverpool FC won the Premier League in 2019-2020 and the Champions League in 2019. With all the recent pedigree, it is no surprise that Stroll was happy that his team is added to Arctos’ portfolio.

Photo Credit: Aston Martin Cognizant Aramco Formula One Team

Now, what will this mean for the Silverstone team? Well, the need for money may not seem evident, until you look under the surface. Aston Martin are still working on their new “campus” which plans to open progressively in the next few years, and financing is needed when a new factory is being built, especially one with the aspirations that Aston Martin have. With the extra money, the lavish new factory that Aston Martin have been planning can come to fruition with more financial stability.

To add, with the added investment, Lawrence Stroll may finally be able to achieve his goal that he set out when he first purchased a majority ownership stake in the team: to fight for championships. When he went on the Grill the Grid podcast in 2022, he said that he does not need to win championships, but needs to fight for them.

With less financial strain on his personal pockets, and an experienced group of sports managers to help him optimize the teams’ processes, Aston Martin may be able to get to the front of the pecking order, as they did this year, but stay there over the course of the season.

To add, with the team now valued at over 1 billion dollars, Stroll can now see the business side of his venture pay off with the increase in team value increasing since he took over. In the eventuality that Stroll sells the team, whether sooner or later, his pockets will be fuller than when he started this venture more than 5 years ago.

Everything seems to be going to plan for the multi-club method at Alpine, as the team has picked up form as of late. Now, it is up to see whether the multi-club method works out for Aston Martin, Lawrence Stroll and Arctos.