30/01/2013
NEWS STORY
 |
Pitpass understands that Jorg Lindner and Kai Richter, the two entrepreneurs behind the Nurburgring, have filed a lawsuit against its boss Karl-Josef Schmidt for allegedly damaging negotiations with Formula One's boss Bernie Ecclestone about the circuit hosting the German Grand Prix.
The development adds to the uncertainty over whether the German Grand Prix will take place this year. The Nurburgring previously held the Grand Prix in 2011. It alternates with the Hockenheimring and is due to host the race this year but was not confirmed as the location when the 2013 calendar was released in December. Instead the calendar stated that the location is to be announced.
It is understood that Lindner and Richter were due to get a 30% share of the profits from the F1 race which, according to the lawsuit, was worth at least £4.3m (€5m).
Since its opening in 1927, the Nurburgring has been under complete public ownership and administration, but in 2010 it was rented out to Lindner and Richter who were the driving forces behind a radical renovation plan. A shopping mall, amusement park and hotel were added to the Nurburgring which used a £235m ($370m) loan to fund the project. The loan came from the Bank Rhineland-Palatinate, the central economic development agency of the local state government which majority owns the track.
In July last year the state government announced that the Nurburgring was on the verge of bankruptcy after it had reportedly struggled to make repayments on the loan. So, despite not having to pay the estimated £18.4m ($29m) F1 race fee every year, the circuit has still suffered severe cash-flow problems. To avoid insolvency it received additional public support, including a rescheduling of interest payments, but then faced a further setback as the European Commission launched an investigation claiming that the assistance was not granted on market terms.
Earlier this month, when Pitpass' business editor Christian Sylt asked Ecclestone whether it looks like the race will take place at the Nurburgring this year he responded "no. The trouble is that the people that used to be there have gone. They haven't got enough money. So we will see."
He added that the decision on the location of the race could be made once the season has begun so there is no imminent deadline. However, it will have to be finalised soon since the race is due to take place on 7 July. The clock is ticking.