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Nurburgring racetrack could file for bankruptcy

By SYF77 on 27 Jul 2012

Attached Image: nurburgring_image.jpg

The Nurburgring is facing bankruptcy because its private operating company, Nurburgring GmbH, is no longer able to pay the interest on a 330 (S$507) million loan that was provided by the ISB investment and the structural bank, which belongs to the state.

Attached Image

In addition, the company hasn't been able to cover its lease payments. A report in the Rhein-Zeitung newspaper states that the operating company has debts of 413 (S$634) million, including the ISB loan and 83 (S$127) million in other outstanding loans.

The state's governor, Kurt Beck, is blaming the European Commission for not approving a 13 million (near S$ 20 million) state aid package in time for a July 31 payment deadline. This could lead to a very high probability of insolvency at the end of the month because of insufficient liquidity, according to Kurt.

The race track has been operating at a loss for years, frequently requiring millions of euros in both direct and indirect state aid to survive. The park's financial woes began in 2004 when it began building a year-round amusement park and hotel complex that has only been partially completed and has so far been a commercial failure.

"The whole of Nrburg lives off the ring. Now the region itself might go down the drain," Mayor Reinhold Schussler told the local newspaper Trierischer Volksfreund. It looks like German chancellor, Angela Merkel, has got some work to do at home in addition to saving Greece and Spain.

The 25km long Nurburgring is one of the world's most famous race tracks. The course first opened in 1927 and a new track was built in 1984 to accommodate Formula One racing.

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SYF77
Written by SYF77
I have been a car fanatic since 1989, when my father was changing our family car then to a Toyota Corolla 1.6 GL fitted with a Twin Cam 16 valve engine that was carburetor-fed, a big deal back in those days. The automobile technology and industry fascinates me and I hope to broadcast these interesting developments to everyone out there through this blog.



 
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