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Apple [NSDQ:AAPL] has approached McLaren Technology Group over a potential sale of part or all of the company, the Financial Times reported on Wednesday.
The deal could be worth as much as £1.5 billion (approximately $1.94 billion), people familiar with the matter told the British publication.
Both firms declined to comment directly to the Financial Times and The New York Times; McLaren Automotive, the road car business of McLaren Technology Group, said it has not been in investment talks with Apple.
The news follows years of speculation that Apple may be developing a car under the code name Project Titan. The tech giant has recruited hundreds from the auto industry and in 2015 approached officials from California's GoMentum Station about gaining access to the facility. GoMentum is a former naval base located near San Francisco that's been converted into the world’s largest secure facility for autonomous and connected car development.
McLaren Technology Group is a consortium of high-tech businesses that includes the famous McLaren Formula One racing team and a stake in the aforementioned McLaren Automotive, which is responsible for modern machines such as the P1 hypercar and 650S and 675LT supercars. It’s a private company whose majority stakeholders are Ron Dennis, Mansour Ojjeh and the Bahrain government. The company doesn’t release financial results but in 2014 it recorded pre-tax losses of $29.3 million.
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The Financial Times’ sources claim Apple is interested in McLaren’s technology, engineering expertise and numerous patents. For example, the company produces high-performance electric motors and ECU chips used in motorsport. However, the sources are unsure how a recently reported shift in Apple’s car strategy affects the deal. In July, Bloomberg reported that Apple had fired numerous staff from Project Titan in order to focus on developing technology for autonomous cars rather than developing an autonomous car of its own. Original team leader Steve Zadesky also left earlier in 2016. He's since been succeeded by Apple veteran Bob Mansfield.
However, it could be that Apple is only backing off from manufacturing its own car. Bloomberg this month reported that staff from Canadian independent vehicle manufacturer Magna International was working with Apple on developing a car. It’s possible Magna ends up building Apple’s car, in the same way that Taiwan’s Foxconn builds the company’s famous iPhones.
The McLaren deal wouldn’t be Apple’s first in the auto industry. In May, Apple announced it had invested in Chinese ride-sharing giant Didi Chuxing Technology. Autonomous cars combined with ride-sharing is seen as a lucrative source of revenue among many firms.
Stay tuned for an update.