Force India administrator faces legal action over Formula One team’s sale

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The administrator to Force India is being sued by Uralkali, the Russian group that missed out on acquiring the Formula One team.

Uralkali claims that FRP Advisory oversaw a “flawed sales process” which ignored its higher bid for the business.

Force India was eventually sold last month to a consortium of investors led by Canadian billionaire Lawrence Stroll, a deal which secured 405 jobs at its base in Silverstone, Northamptonshire.

FRP is being sued for “substantial damages” at the High Court by Uralkali, with the Russian firm claiming it was subject to “prejudicial and unequal treatment” during the sale process.

The legal challenge alleges that FRP “abused” the administration process by failing to recognise Uralkali’s bid as successful and higher, making “misrepresentations” and failing to act in the interest of creditors, shareholders and other stakeholders.

Uralkali, which produces potash fertiliser, railed in a statement: “Uralkali had a strong business rationale for acquiring Force India.

“The company sells its fertilisers to more than 60 countries worldwide, including 20 in which Formula One holds its Grand Prix Championship.

“For several years, Uralkali, together with one of its subsidiaries, has been a partner of Force India and one of the sponsors of the Russian Formula One Grand Prix in Sochi.”

Force India hit the skids in July and called in FRP as administrators to avoid a winding-up order from creditors, after which Uralkali tabled a bid for between £101.5 million and £122 million.

FRP said in a statement that it will defend itself “vigorously”.

The firm added: “We have fulfilled our statutory duties as administrators throughout this process and ultimately achieved a very successful outcome for all stakeholders. Any legal action brought against us will be defended vigorously, and we are confident it would be dismissed.”

Paul James Ostling, senior independent director of Uralkali, who led its offer for Force India, said: “We had a strong business case for acquiring Force India and we believe our bid was the best one tabled, and the administrators have confirmed it was well in excess of the bid they chose.

“We have serious concerns as to why the administrators did not use the opportunity to maximise the amounts that could have been paid to creditors and shareholders.

“Because of these concerns and the costs of our bid, as well as potential large business revenue losses, Uralkali has no option but to launch these proceedings and seek substantial damages.”

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