McLaren-Mercedes has been rocked by the embarrassing revelation that it evaluated a potential ?25 million sponsorship association with Libyan dictator Colonel Muammar al-Gaddafi's blood-stained regime last year - although it insists 'the deal never reached square one'.

According to the Daily Mail, the man at the centre of the controversy is former British F3 ace Alex Waters, whose uncle Brian Waters was in discussions with Gaddafi's playboy son Saif regarding planning work in Libya as the principal of London-based architects BWCP, as well as the reconstruction of the Tripoli circuit that staged grands prix between 1925 and 1940. Alex Waters' father Peter - who runs a Land Rover dealership close to Bath - was reportedly simultaneously in talks about the possible export of Supacat armoured vehicles to Libya.

When Brian Waters discovered that Saif Gaddafi was interested in motorsport - with prior mooted involvement in the abortive Villeneuve Racing bid for the unoccupied 13th spot on the F1 2011 starting grid [see separate story - click here] - he imparted the information to Alex, who signed an agreement with McLaren early last year stipulating the financial gain he would receive should he successfully broker a deal between the Woking-based outfit and the state-owned Libyan Tourist Board, promoted by Saif.

A mock-up of specially-liveried McLaren cars sporting the message 'Visit Libya' was subsequently produced, whilst Saif Gaddafi - who has recently returned to his homeland from London in an effort to bolster his embattled father's chances of doggedly clinging onto power against the backdrop of the ongoing popular uprising in the country - was also invited to visit the team's factory. The multiple F1 World Champions already have ties with besieged Arab leaders through the Bahrain government's part-ownership of the team.

The Mail claims to have seen e-mails sent by lawyer Peter Goodman, of SA Law, to the Waters regarding the drafting of contracts with Supacat, making reference to BWCP although not McLaren.

"McLaren were approached by Alex Waters in January last year," confirmed a spokesman for the team, albeit denying all knowledge of the Supacat link. "Waters asked whether we would be interested in meeting a consortium from Libya with a view to discussing a commercial sponsorship.

"We explored this with Waters, and e-mailed him computer-rendered illustrations of what a McLaren car might look like if such a sponsorship were to come into being, but no meetings between any personnel from McLaren and any personnel from the consortium from Libya ever took place, and the deal therefore never reached square one."

Alex Waters' website features a testimonial from McLaren star and 2008 F1 World Champion Lewis Hamilton, whilst only last month, Sir Howard Davies resigned from his position as director of the London School of Economics (LSE) after it emerged that he had accepted a ?1.5million donation from a foundation controlled by Saif Gaddafi in 2009.



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