Mercedes Walks Away From Alpine Stake Deal Over $720 Million Valuation

Mercedes has abandoned its pursuit of a minority stake in the Alpine F1 team after failing to agree on a valuation with current shareholder Otro Capital. The German manufacturer, already Alpine's power unit and gearbox supplier, had agreed in principle with majority owner Renault to acquire Otro's 24% stake, but the deal collapsed over Otro's $720 million asking price, which values the team at $3 billion — well above what Mercedes considers a sound financial investment.

Why it matters:

This deal's collapse highlights the soaring valuations in Formula 1 and the strategic importance of team ownership for engine manufacturers. Mercedes' decision to walk away signals a disciplined financial approach, while Alpine's search for investment continues. The episode also underscores the growing gap between what sellers expect and what buyers are willing to pay in the current F1 market.

The details:

• Otro Capital acquired the 24% stake in June 2023 for $233 million — a significant markup in less than three years.
• Majority shareholder Renault has the power to veto any sale of Otro's shares until September 2026, giving them leverage over potential buyers.
• Other interested parties include a consortium led by former Red Bull boss Christian Horner, though no formal bid has been confirmed.
• Alpine recently announced a landmark title sponsorship deal with luxury giant Gucci, rebranding the team as Gucci Racing Alpine from 2027. The deal replaces water technology company BWT and was orchestrated by former Alpine CEO Luca de Meo (now heading Gucci's parent company Kering) and executive advisor Flavio Briatore.
• Mercedes has declined to comment, while Alpine has been contacted for a response.

What's next:

Alpine's future ownership structure remains uncertain. With the Gucci deal providing significant financial stability, the team may not be in a rush to sell. However, the need for capital to compete at the front of the grid could push for a resolution before Renault's veto period expires in September. Meanwhile, Mercedes will continue its existing technical partnership with Alpine while focusing on its own 2026 power unit development.