Sahara Group buys stake in Force India F1 team

With just 19 days to go for the inaugural Indian Grand Prix, Sahara Group today bought 42.5 per cent stake, worth $100 million, in the Vijay Mallya owned Force India F1 team, which has been re-christened as Sahara Force India.

Sahara Group, headed by Subroto Roy, inked an agreement with Mallya's UB Group, which will also have 42.5 per cent stake in the team.

The remaining 15 per cent will be with the Mol family.

Mallya will continue to be the Team Principal.

Liqour baron Mallya had bought the Spyker Ferrari F1 Team in 2007, reportedly for about for €90 million. He then renamed the team as 'Force India' for the 2008 season.

The Force India team is at the sixth position in the constructor's championships with 48 points in the current season.

Mallya also owns IPL team Royal Challengers.

On the other side, Sahara Group that has interests in financial services, real estate, media and hospitality, is a major promoter of sports in India.

Sahara owns the new IPL team Pune Warriors India and also sponsors India national cricket team. It had also supported the Indian national hockey team.

India will host its first Formula 1 Grand Prix on October 30, 2011 on a 5.14km track, in Greater Noida built by Jaypee Sports International (JPSI).

Force India was formed in 2007 when a consortium led by Mallya and Dutch entrepreneur Michiel Mol bought the loss-making Spyker Formula One team and later renamed it Force India.

India is set to host its maiden Grand Prix on October 30 at the 120,000-capacity circuit on the outskirts of Delhi.

Mallya has a profitable liquor business, but is facing rough weather in aviation.

His Kingfisher airline, India's second-largest private airline, which has never reported a profit, recently announced plans to exit the low-cost part of the airline business and focus on the premium model to reduce debt.

The auditors of Kingfisher have said that the firm needs extra cash as the airline struggles to survive in a challenging market.

Force India, whose current drivers are German Adrian Sutil and Britain's Paul Di Resta, are currently placed sixth in the Formula One constructor standings.

The Sahara group, which also supported the Indian hockey team, had bid $370 million to become owners of the Pune franchise in cricket's Indian Premier League in October, 2010.