Mercedes walks away from Alpine stake talks as $3bn valuation proves too steep

Mercedes has withdrawn from talks to buy a minority stake in the Alpine F1 team, with the breakdown driven by a significant disagreement over Otro Capital’s $720 million asking price — a figure that values the Enstone-based outfit at $3 billion.

Mercedes, which already supplies power units and gearboxes to Alpine, had agreed in principle with majority owner Renault to acquire Otro Capital’s 24% share. However, sources familiar with the situation indicate that Mercedes considers the $3 billion valuation well above what it believes Alpine is worth, making the deal financially untenable. Insiders at Alpine have confirmed the talks have ceased, and both Mercedes and Alpine have declined to comment publicly.

Otro Capital acquired its stake as recently as June 2023, paying $233 million for the holding — meaning the group is now seeking more than three times that figure just two years later. Renault, as majority shareholder, is understood to retain veto power over any prospective buyer of Otro’s share until September, giving the French manufacturer significant influence over who ultimately joins the ownership structure.

Among the other parties circling the available stake is a consortium linked to Christian Horner, the former Red Bull team principal. Horner’s involvement adds a notable dimension to the sale process, given his long tenure at the top of one of Alpine’s direct rivals on the grid.

The collapse of the Mercedes talks comes in the same week that Alpine announced a headline-grabbing commercial agreement with luxury fashion house Gucci. The Enstone squad will be rebranded as Gucci Racing Alpine from 2027, with Gucci replacing water technology firm BWT as title sponsor and taking over the team’s car livery. Former Alpine CEO Luca de Meo, who now leads Gucci’s parent company Kering, was instrumental in brokering the arrangement alongside the team’s executive advisor Flavio Briatore.