03/08/2012
NEWS STORY
The state legislature budget committee of Rhineland-Palatinate is to guarantee a loan for the Nurburgring circuit which recently filed for insolvency.
As the F1 circus arrived at Hockenheim for the recent German Grand Prix - the circuit shares the event with the Nurburgring on a rotating basis - Kurt Beck, the state governor for the Rhineland-Palatinate region in which the Nurburgring is located, admitted that the company behind it, Nurburgring GmbH, owes the Rhineland-Palatinate bank almost £235m for redevelopment work carried out in 2009.
Nurburgring GmbH had applied to the European Union's Executive Commission for an emergency loan of £10m to cover interest repayments, however this was not granted.
Now, the state of Rhineland-Palatinate has released "is releasing €254M (£192m) to guarantee a loan for the circuit, the budget committee having approved the deal on Wednesday.
This way, the Nurburgring "can service" a €330M (£259m) loan and "stay afloat", according to AP.
Meanwhile, Speigel Online reports that the state legislature "has to hurry up in activating its reserves, if it wants to keep interest fees as low as possible."
It is understood that, according to the government's finance department "every day, on which the state cannot pay off the credit, has a price tag" of €47,000 (£37,000).