Just before Christmas the Italian newspapers picked up a story that suggested that the Italian regional authorities in Piedmont and Tuscany had received a non-binding expression of interest from “an English group, backed by a Luxembourg fund” to acquire the assets of the De Tomaso automobile company, which has been in administration since 2012. The Italian regional politicians are keen to save the 900 jobs at the De Tomaso factory in Grugliasco, a Turin suburb, and another 120 at Livorno in Tuscany. The court overseeing the administration agreed to delay shutting down the business until May 4, to allow for negotiations to continue.

What has this got to do with Formula 1?

Well, how many English groups involved in the automotive business can you think of that are backed by Luxembourg funds?

Some of Italian media picked up on the idea that the rescuer might be Lotus, but the assumption seems to have been that the authorities were talking about Group Lotus, the Malaysian-owned Norfolk-based car manufacturer, which is currently struggling. No-one suggested that the bidder might be the Lotus F1 Team.

If you ask in F1 circles you will hear that the Enstone team is in trouble. It has major cash-flow problems and some big debts. Its CEO Patrick Louis has just departed and has been replaced by someone called Matthew Carter, who does not seem to have any experience in the sport. His connection seems to be that he has worked with Andrew Ruhan, one of the team’s non-executive directors, and a mate of Genii Capital owners Eric Lux and Gerard Lopez.

When you look a little more closely at Lotus F1 Team, you discover that, yes, the team does have cash-flow trouble and it is losing staff at an alarming rate. It signed a deal with Pastor Maldonado in order to get access to his considerable sponsorship from PDVSA, the Venezuelan government oil company. These were not good signs. However, when it comes to debt, it is true that the team owes about $160 million but most of this is internal debt, owed to Genii Capital. There are some debts with suppliers, but most of the rest of the money is owed to Proton, the parent company of Group Lotus, which agreed to guarantee $50 million of debt a couple of years ago. At the time there were some grandiose plans for the team and the Lotus car company. Today all that Group Lotus gets is free publicity from the use of the name. The relationship ends there and it does not make a lot of sense, except that the Lotus name does seem to open some doors for the F1 team in the corporate world. That has not really translated into major sponsorship money, but it has been helpful up to a point.

When you step back and look at the team from a distance you see that what is really required is a raison d’être – a reason to exist. The team goes racing and wins prize money, but that does not make a sustainable business model in the modern age. Look up and down the F1 pitlane and almost all the teams now exist for a purpose other than racing: Ferrari, McLaren, Mercedes, Caterham and Marussia exist to sell cars (and other technologies). Red Bull Racing and Scuderia Toro Rosso exist to sell energy drinks. Williams has a fast-developing technology division. Force India was used to sell things owned by Vijay Mallya, although the logic reduces as his empire reduces in size. Only Lotus and Sauber have no reason to exist beyond racing. And both seem to be struggling as a result. Sauber is hoping that a new alliance with Russia will solve its problems and Lotus is looking for something similar. The team thought it had found the solution with Quantum Motorsports, which signed a deal last summer to buy a chunk of the team in order to promote companies involved in the consortium but for reasons that remain unclear, the money has never arrived. No-one seems to have gained anything from the whole process.

It is no secret that Genii Capital has long wanted to own a car company. It bid for Saab back in 2010 and later purchased the Porsche tuning firm Ruf, which is moving slowly towards being a manufacturer in its own right. The partners are still on the lookout for a brand to use and one can speculate that they may think that they have found it in De Tomaso. The name is sexy and the company has a history in F1, albeit not a very glorious one, which dates back to 1969 when none other than Frank Williams did a deal with Alejandro de Tomaso to run cars in F1 in 1970 for Piers Courage to drive. The car was designed by a young Gianpaolo Dallara. Alas, Courage was killed in an accident at Zandvoort that summer and the De Tomaso team fell apart.

It is all great theory but, as ever, if this is going to happen it will require money. Developing supercars is expensive and Genii clearly does not have the cash to do things on its own, even if the regional authorities in Italy will almost certainly throw in some money and there is some synergy as Ruf could provide a design for De Tomaso to manufacture, thus cutting out a lot of R&D costs.

However, what is really required is a big industry partner who can use a relationship with the company to its own advantage, as Renault is doing with Caterham at the moment.

One of the current trends in the automobile industry is for the big players to have a string of brands aimed at different market sectors: Volkswagen, for example, owns VW, Audi, Porsche, Seat, Skoda, Bentley, Lamborghini and Bugatti, while the Renault Nissan partnership has expanded its range to include Dacia, Renault-Samsung, Infiniti, Datsun, Alpine and Initiale Paris. Fiat is trying much the same thing with its Italian brands linking up to those used by Chrysler in the US, so that the group boasts Fiat, Alfa Romeo, Lancia, Abarth, Jeep, Dodge, Chrysler and Ram, while also having close links with Ferrari and Maserati. Joint ventures are also all the rage in the industry so one can imagine that Genii’s pitch to manufacturers would be for funding to revive De Tomaso, in exchange for a share in the business. Their package might be attractive as they bring Ruf and an F1 team (a means of promotion) to the table.

The obvious place for Genii to look for help is China where there are around 30 car firms that have been expanding rapidly to feed domestic demand in recent years. Some of these want to get into the export business and have started looking at international mergers and acquisitions. Volvo, for example, is now owned by Geely and MG by SAIC.

The situation regarding De Tomaso is rather more complicated than it may seem because in November a company called ATS bought the rights to the brand.

If ATS sounds familiar it is because the brand was created in 1961 as a breakaway company from Ferrari, the plan being for a group of Ferrari executives to build F1 cars funded by the sale of exotic road cars. That group was led by Carlo Chiti. The plan resulted in a handful of road cars and an F1 team that ran in 1963 with 1961 World Champion Phil Hill as one of the drivers. The firm quickly failed but was revived a couple of years ago by an ambitious entrepreneur called Gianluca Gregis, who had previously run a sales and service establishment in Milan, dealing in exotic sports cars. Oddly enough, Gregis also happens to be the Italian representative for Geely.

If a deal does go ahead one would imagine that the Lotus F1 Team would be rebadged as De Tomaso F1.

It may just be a whopping coincidence, but a new company was established in Britain yesterday called Pantera Invest Ltd – the De Tomaso Pantera being the firm’s most famous vehicle. There is no obvious link in the filings to Genii Capital, but as the business seems to have been set up by a company registration firm it is impossible to tell anything more at the moment.