F1: Germany's Nurburgring Circuit Faces Insolvency
Written by: Associated Press
Date: 07/18/2012 - 10:00 AM
Location: Berlin (DEU)
Germany’s Nurburgring circuit, which has hosted Formula One’s German Grand Prix, is to launch insolvency proceedings amid fears that it could run out of cash while the European Commission considers planned government aid.
The state government in Rhineland-Palatinate, which owns the financially troubled Nurburgring GmbH, decided on the move on Wednesday, the dapd news agency reported.
State governor Kurt Beck said the reason was that the European Union’s executive commission wasn’t expected to approve planned government aid of €13 million ($16 million) by the end of this month.
That would lead “with high probability to an insolvency at the end of the month because of a lack of liquidity,” Beck said in the state capital, Mainz. He said his government decided to pre-empt that by choosing to launch “orderly insolvency proceedings.”
The German GP has alternated in recent years between the Nurburgring and Hockenheim. This week’s race is at Hockenheim.
The private company that operates events at the circuit, Nurburgring Automotive GmbH, said that it wasn’t directly affected by the insolvency of the owner and would continue its operations.
The company said in a statement that it agreed with F1 chief Bernie Ecclestone last week on “a concept with which Formula One next year would be feasible.” The company had asked the state government for its approval and hoped to be able to conclude a deal shortly. It gave no details.