Mandelson’s intervention comes amid concerns that Donington Ventures Leisure Limited, the company to which Ecclestone has sold the rights to stage the race, is facing financial difficulties.
Last year Ecclestone granted DVLL a 10-year licence to stage the race from 2010 after losing patience with present host Silverstone. Mandelson’s intervention is understood to have played a part in persuading Ecclestone to extend the licence to 17 years, but doubts about the business plan put forward by DVLL and its chief executive, Simon Gillett, have intensified in recent weeks.
Sources with knowledge of the project have confirmed that DVLL is reliant on bank finance to keep the project on track, and the company is understood to be in negotiations to refinance credit agreements worth up to £80 million.
DVLL is also facing legal action from the circuit’s owners, the Wheatcroft family, who are owed £2.5 million in unpaid rent dating from last September and are understood to be concerned about the company’s future.
Earlier this month the track’s safety licence was withdrawn because of work to upgrade the circuit for the F1 Grand Prix, meaning all events have been cancelled until mid-May, and the local council revealed that DVLL is yet to meet the conditions of its planning application. The launch of a debenture-style scheme intended to finance circuit upgrades has also been delayed by at least a month and it is unclear when it will finally be offered to potential investors. Telegraph.co.uk
Peter Mandelson has this week opened discussions with Bernie Ecclestone in an effort to retain a future British date on the formula one calendar.
A meeting had been due to take place for weeks but the business secretary made his first formal contact by telephone on Monday. The government has grown alarmed at Ecclestone’s claims he will scrap the British grand prix if Donington fails to make the grade. For now at least it will play host to the race from 2010 under a 10-year agreement with Ecclestone’s rights-holding Formula One Management.
Although there was no offer of direct government funding, something Ecclestone had called for last week, Mandelson pointed out that they had been willing to support infrastructure developments at Silverstone with the possibility of regional development agency cash. However, the discussions were inconclusive and Ecclestone, who has had a number of high-profile clashes with Silverstone’s owners, the British Racing Drivers Club, is likely to have been unmoved by those pledges. Guardian.co.uk
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