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Following Tan Sri Tony Fernandes’ sale of the Caterham F1 Team to a consortium of Swiss and Middle Eastern investors in July, all has not exactly been smooth sailing, if reports are to be believed.

In its first month of new ownership, a group of individuals were reported to have claimed unfair dismissal from the F1 team, and there were also allegations that its staff had not been paid their July salaries, to which Caterham F1 said was “wholly untrue” in a statement.

A few months later, Caterham Sports Limited (CSL), the 1Malaysia Racing Team-operated company that builds racing cars for the F1 team, went into administration, placing 200 jobs and its base in Leafield, Oxfordshire in uncertainty. Bailiffs had reportedly seized various items from the Leafield site.

Fernandes’ Caterham Group (comprising Cars, Technology & Innovation and Composites) proceeded to release a statement in early October saying that it “has no affiliation with Caterham F1 Team,” and that the bailiffs’ actions had “no bearing whatsoever on the car company or any of its affiliate business arms.”

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More recently, Caterham F1 released a statement, effectively accusing former owner Fernandes of not transferring shares to the new owners. It said CSL’s administrators were appointed on behalf of Export-Import Bank of Malaysia (Exim Bank), a creditor of Fernandes and the Caterham Group, and that the administrators’ appointment had negatively affected the F1 team’s activities.

Caterham F1’s new owners, Engavest SA, said that they were now forced to explore all options including the withdrawal of the management team, and that lawyers will bring claims against all parties to the effect that Fernandes will run the F1 team “as an owner.”

The AirAsia founder told the BBC that the statement was “garbage,” and in response to a question by a Twitter follower, he tweeted: “If you buy something you should pay for it. Quite simple.”

Fernandes and Caterham Group CEO Graham Macdonald issued a joint statement yesterday, claiming that the new owners of the F1 team have not fulfilled the conditions necessary for the transfer of shares, including paying “all of the existing and future creditors, including the staff.”

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The statement claimed that Caterham Group’s lawyers have asked Engavest several times to comply with the conditions, but to no avail. “Not only have they failed to pay the creditors (and have even left our shareholders to pay some of the creditors on their behalf), but they have failed to pay us anything for use of our factory and site, or anything for the use our brand name,” stated Macdonald.

“In short the new owners have paid us nothing and now the administrators have been appointed they want to walk away from their liabilities.”

And the war of words continues. Engavest SA was quick to hit back in another statement, refuting the allegations and saying it has met every single one of its conditions in the Sale & Purchase agreement, as well as paid all salaries.

“Incidents such as a Caterham Group representative forcibly breaking into a filing cabinet containing our private and confidential documents and the continued refusal to deal with the outstanding loan of Exim Bank and complete the agreement has culminated in Engavest’s total contempt of Mr Fernandes and his Group executives with whom we entered a deal in good faith.”

Reuters reports that Caterham F1 staff were locked out of the factory yesterday. The cars in the factory will not make it in time to be transported to Texas for the upcoming US Grand Prix unless a deal is made fast.

Caterham Group statement dated October 3, 2014

Caterham Group wishes to clarify that, following the sale of the F1 business in July, it has no affiliation with Caterham F1 Team.

Regarding news reports today that bailiffs have removed several items from Caterham F1 Team’s Oxfordshire base, Caterham Group also wishes to assure its customers and suppliers that this action has no bearing whatsoever on the car company or any of its affiliate business arms.

Moreover, the Group wishes to reiterate that neither the Company nor any of its automotive or engineering divisions are in any financial danger. The shareholders of the Group, including co-Chairmen Tony Fernandes and Datuk Kamarudin Meranun, are wholly committed to the business.

The Caterham brand name is in Formula One as a result of the Group’s former ownership of the F1 team and is being used under licence. The Caterham Group is concerned about the negativity that these circumstances, which are outside of its control, have on its brand and will continue to monitor the situation.

Caterham Group now consists of Caterham Cars, Caterham Technology & Innovation and Caterham Composites; the F1 team is now run by an unconnected consortium of Middle Eastern and Swiss investors, following its sale earlier this year.

While the Caterham F1 Team never reached its full potential, the other arms of Caterham Group – Caterham Cars, Caterham Technology & Innovation (CTI) and Caterham Composites – have continued to develop and flourish.

The order book for Caterham Cars is full until March 2015, with the Company having to ramp up production from last month to satisfy increasing and unprecedented global demand for the legendary Seven.

As Caterham Composites’ work in the aviation, marine as well as automotive sectors grows apace, CTI continues to win new third party contracts as well as the development of the new flagship Caterham two-seater sportscar, codenamed C120, amongst other projects.

Caterham F1 Team statement dated October 22, 2014

On 29 June 2014, Caterham Enterprises Ltd, Caterham (UK) Ltd and Sheikh Mohamed Nasarudin (Seller) and their shareholders Tony Fernandes and Datuk Kamarudin Bin Meranun entered into a Sale and Purchase Agreement (SPA) with Engavest SA (Buyer) with regards to 1Malaysia Racing Team Sdn Bhd/Caterham F1 Team.

Since the date of the Agreement, the Seller has refused to comply with its legal obligations to transfer their shares to the Buyer. The Buyer has been left in the invidious position of funding the team without having legal title to the team it had bought. This is in total contradiction to the Seller’s press release of 3 October 2014 which stated that Mr Fernandes and his Caterham Group had no longer any connection with the Caterham F1 Team.

The administrators of Caterham Sports Limited have been appointed on behalf of Export-Import Bank of Malaysia Berhad (Exim), a creditor of Mr Fernandes and the Caterham Group. The Buyer has no connection with Exim. Caterham Sports Ltd was a supplier company to the Caterham F1 Team. Very regrettably, the administrators’ appointment has had devastating effects on the F1 Team’s activities. Since their appointment, the administrators have released various press statements which have been severely detrimental to the management of the Caterham F1 team.

After three months of operating the Caterham F1 Team in good faith, the Buyer is now forced to explore all its options including the withdrawal of its management team. Lawyers have been instructed by the Buyer to bring all necessary claims against all parties, including Mr Fernandes who, as an owner, will run the F1 operation.

Joint statement by Tony Fernandes and Graham Macdonald dated October 23, 2014

Tony Fernandes, Caterham Group co-Chairman: “In June 2014, I decided, together with my co-shareholders, to sell my stake in the Caterham F1 team. We agreed in good faith to sell the shares to a Swiss company named ‘Engavest’ on the basis that Engavest undertook to pay all of the existing and future creditors, including the staff. The continued payment of staff and creditors was so important to me that I ensured that the shares would not be transferred to the new buyers unless they complied with this condition.

Sadly, Engavest has failed to comply with any of the conditions in the agreement and Caterham Sports Ltd (the UK operating company of the F1 team) has had to be put into administration by the bank, with large sums owing to numerous creditors. Our agreement with Engavest was very clear: there was no legal obligation to transfer the shares to them unless certain conditions – which included paying creditors – were met. Those conditions have not been met. Our lawyers have asked Engavest several times to comply with these conditions but they have failed to engage.

If you agree to buy a business, you must pay its bills. They have breached that promise and now, sadly, it is others such as the employees and the fans of the Caterham F1 team that will suffer if the team ceases to race. I sincerely hope that this will not be the case and that a solution can be found.”

Graham Macdonald, Caterham Group CEO: “We genuinely believed, at the time, that the sale of the team was the best route for the staff and creditors of the Company, as we felt it secured its long term future. The whole agreement with Engavest was based around a low consideration for the business, with easy payment terms so that creditors and staff could be paid. The buyers were made fully aware at the time of all outstanding liabilities. However, it appears to me that they never had any intention of paying these liabilities. I go on to question how anyone who was interested in the long term future of the business would appoint one of their cleaners – Constantin Cojocar – as the sole director and shareholder of the UK operating Company?

We continue to see claims and counter claims from the F1 team which are totally unfounded. Not only have they failed to pay the creditors (and have even left our shareholders to pay some of the creditors on their behalf), but they have failed to pay us anything for use of our factory and site, or anything for the use our brand name. In short the new owners have paid us nothing and now the administrators have been appointed they want to walk away from their liabilities.”

Engavest SA statement dated October 23, 2014

Engavest SA, strongly refutes the allegations of Tony Fernandes and Caterham Group CEO Graham Macdonald regarding its conduct while trying to purchase Caterham F1. Our statement of earlier today still stands.

Every single condition precedent of the Sales and Purchase Agreement for which Engavest was responsible has been met.
Only the seller, which includes Mr Fernandes, failed to meet his obligations. All salaries have been paid.

Engavest sold CSL. It did not appoint Mr Cojocar who, we believe, was a former top footballer for Steaua Bucarest during the 1980s.

The claims of Mr Fernandes and Mr Macdonald contradict their own press statement dated 03 October 2014: “Caterham Group wishes to clarify that, following the sale of the F1 business in July, it has no affiliation with Caterham F1 Team”.

That one sentence alone contains two errors:

1. the date was June 29
2. having failed to transfer the shares Caterham Group and Mr Fernandes wholly owned Caterham F1 at the time of the statement, as they do today.

Incidents such as a Caterham Group representative forcibly breaking into a filing cabinet containing our private and confidential documents and the continued refusal to deal with the outstanding loan of Exim Bank and complete the agreement has culminated in Engavest’s total contempt of Mr Fernandes and his Group executives with whom we entered a deal in good faith.