Flywheel Hybrid Technology is Williams F1’s Real Stock.

By Charles Oladeji.

The announcement today that the venerated British Formula One team Williams F1 will float 29% of its company stock on the market has been anticipated for some while now. Frank Williams and Patrick Head who created the independent F1 team in 1977 may have delayed its floatation in an effort to remain loyal to the principles upon which the team was created; to be independent. Yet they have never shied away from a good business deal in order to survive .

The principle upon which William F1 has built this iconic team is a format which many have tried to emulate and failed in the past. Aficionados of the sport have a deep sense of pride in Williams F1’s achievements over the years, as well as its ability to survive the piranha infested waters of F1.

Williams F1 sustained longevity in F1 despite being a non-manufacturer team like McLaren, Renault, and Ferrari. However, Williams F1, known commercially as AT&T Williams F1, has survived in the past by making very shrewd business moves with manufacturers like Renault, Cosworth and BMW for tech support. Recently, there’s the 2009 deal brokered between Williams and the Qataris to create the Williams Technology Centre (WTC). This is a Formula One inspired R&D project with commercial intent.

In addition to the business side of things, on race day Williams F1 can still spring a surprise or two with experienced drivers like Rubens Barrichello piloting their expensive machinery around the track.

The F1 Team Value

Most of Williams F1 current finance, which is reported to be in the black to the tune of around 25 million pounds comes from what it gets from sponsors, and its share from F1 commercial rights under the current Concorde Agreement due to be renewed in 2013. AT&T Williams assets in total are in valued at around 250 million pounds.

Yet, an investment in Williams’ meagre 29% stock on offer from its total holding for approximately 24 Euros a share, cannot afford to focus solely on Williams F1’s ability to challenge Red Bull, Ferrari, or McLaren while Bernie Ecclestone, a companion and supporter of Frank Williams holds the reins of power.

To the discerning eye for a good investment, a more valuable prospect, yet understated aspect of Williams’ 29% share lies not in Williams as a Formula One racing team; but, its engineering capabilities, and how it may yet influence motorsports and mobility in total. Hence, an investment in Williams must be viewed in a long term investment in R&D with a long view.

Unlike a lot of stock market investments made in sports in general usually based on players on a field and its entertainment value, an investment in a company like Williams F1 will entail an investment in future technologies, as advertised on the F1 stage in 2011 by Williams FW33 and beyond.

The Value of Green Technology

At the sharp end of Williams’ technical innovations at present is Williams Hybrid Power (WHP), the engineering and high tech branch of Williams F1, and its Flywheel.

The Flywheel Hybrid- Kinetic Energy Recovery System (KERS) is an innovation developed by engineers via Williams that uses an electrical power and good old fashioned mechanical engineering combined with Uranium processing tech-know-how, to achieve additional power and lower emissions in autosports.

This complex technology uses magnetic composite within the flywheels architecture to generate heavy rotation during braking. It then creates reserve energy to reduce fuel consumption. The technical term used for Williams’ specific approach to KERS is Magnetically Loaded Composite (MLC).

The green energy industry seems impressed with what Williams have managed to achieve thus far, the Flywheel Hybrid technology has won two Motorsports International Awards (MIA). The MIA is a bastion and advocate of greener racing.

Trials of the technology in various areas of endurance racing have been positively received. The flywheel in a Porsche 911 GTR 3 has on two occasions at least gathered good reviews in endurance racing. Furthermore, its association with Porsche 911 can’t hurt. So it’s fair to assume that in this specific area Williams F1’s stock is bound to rise further.

Though KERS technology in itself is becoming old technology to tech heads and those who follow F1 religiously, it is a long way from becoming obsolete in general. The potential for Williams Flywheel is huge as an alternative to what is already on offer. Furthermore, Williams Hybrid Power has every intention of expanding its visibility in mobility and transportation.

Trading of Williams’ F1 stock commences on the Frankfurt Stock Exchange in March. The question is this, ‘with the limited amount of stock on offer; via meagre total assets on the whole, is the investment really worth the wait for an appreciable return’?