By Bruce Williams
Release date: October 23, 2021
A $ 1 million bonus, spread over five years, will come as a result of the series’ pending sale to each of the current 25 owners of racing supercars.
In Afterpay’s Supercars equivalent, the $ 25 million is paid over five years as a “time payment” of the teams’ earnings for the sale of their 35% of the business.
The final details of the updated REC, which will be called Team Racing Charter as soon as the category changes hands, will be negotiated by Roland Dane and Category “Salesman” Tim Miles.
The new deal effectively creates around $ 1 million in value in each of the RECs, a significant turnaround from recent years when both Tickford Racing and Triple Eight Race Engineering returned RECs to supercars with no payment until they were given a new owner were resold.
It’s a far cry from recent years when RECs sold for up to $ 2 million apiece. Recently, if a serious bidder could be found and approved to support a Supercars program, the value had gone down, and the price was somewhere between $ 500,000 and $ 650,000 per person.
However, the full acquisition of Archer Capital and the teams (REC Holders) ownership of supercars results in a guaranteed total payday for each Team Racing Charter owner of $ 650,000 per year for five years.
The sale details indicate that Archer Capital, which has a 65 percent stake, shared a portion of its annual supercar profits, which amounted to approximately $ 20 million, with the teams owning Archer’s 65 percent stake the initial $ 19 million and Archer. get up to the first $ 19 million get only 35%.
This is believed to have been negotiated after the initial sale to Archer, when the teams needed additional funding beyond their 35 percent ownership to continue to cover their running costs.
This meant an average annual payday of around $ 450,000 under the current REC, so with a warranty of $ 650,000 annually for five years, part of which is a payment, about $ 200,000 is due to pay the REC are – hence, owners get $ 1 million for a REC.
As more details of the TLA-ARG buyout emerge, it appears that all plans to expand the network from 26 to 30 cars have been rejected by the team owners as they attempt to limit the offer to keep the value in the revised REC restore.
The REC situation has gotten complicated in recent years as some teams have struggled to find the budgets to use cars and meet the REC requirements to compete in every race of the Repco Supercars Championship.
The current REC has a significant “no-show” penalty that is well in excess of $ 100,000 for each missed event.
Former team owner John Faulkner was once fined $ 300,000 for “liquidated damages” for failing to compete.
It goes without saying that the teams have achieved another significant improvement by negotiating the contractual penalty component in the new charter.
It is understood that the new version sees the team able to abandon the new version REC without further penalties and for their part lose any value in it.
Triple Eight and Tickford each put individual RECs up for sale this year and attracted three bidders, but – ironically – the only successful bid came from Tickford that effectively paid to get its own REC back and also get a check back … In one complicated set of lawsuits, Tickford paid for because it had an agreement with T8 to split the proceeds once one of their RECs was sold.
REC owners are reportedly happy with the new financial contract, which increases their annual income and also pays them for their REC stake.
“It’s as good as money in the bank. It’s been a great turnaround in just a few months when one of two RECS for sale went begging and is still on the shelf after a disappointing string of offers, ”one team owner told Auto Action.
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