The world’s most famous racetrack and home to Germany’s F1 circuit (alternating with Hockenheim), the Nürburgring, has fallen into insolvency as the state-owned firm that owns it cannot pay its bills.
The German state of Rhineland-Palatinate, which owns 90 percent of Nürburgring GmbH, said it was forced to file for bankruptcy after the European Commission refused to grant it the right to pump another €13 million (US$16 million) into the project, which would have allowed the circuit to survive six more months.
In the mid-2000s, the state decided to expand the Nürburgring’s complex into a leisure and business center with a year-round amusement park and hotel complex with an estimated investment of €215 million (US$264 million), of which private investors were supposed to contribute €80 million (US$98 million).
But as reported by Deutsche Welle, private companies stayed away and at the same time, costs sky-rocketed and the state was forced to pick the bill.
A report from the German newspaper Rhein-Zeitung says that the operating company has debts of €413 million (US$507 million), including a €330 million (US$405 million) loan it was provided by the ISB investment and structural bank which belongs to the state, and €83 million (US$102 million) in other outstanding loans.
The track will survive in one form or the other, but by declaring bankruptcy, the state stands to lose millions of euros in taxpayers’ money while local business will feel the blunt force of the crisis as well.
“The whole of Nürburg lives off the ring. Now the region itself might go down the drain,” Mayor Reinhold Schüssler told the local newspaper Trierischer Volksfreund.
Story References: Deutsche Welle and Spiegel
PHOTO GALLERY
