Bidders reverse out of talks to buy the Silverstone racetrack
Silverstone has seen F1 driver Lewis Hamilton take the chequered flag Credit: AFP
Christian Sylt
Alan Tovey
7 November 2016 • 12:01am
Two potential bidders for Silverstone, the home of the British Grand Pix, have walked away from talks, raising fears for the future of the Northamptonshire racetrack.
Both Jaguar Land Rover (JLR) and entrepreneur Laurence Tomlinson, who owns the Ginetta car company, have given up on securing deals which could inject much-needed funding into Silverstone's owner, the British Racing Drivers' Club (BRDC).
Their decisions come at a critical time for the BRDC, with its accounts showing cash reserves fell to just £9,000 at the end of 2015.
This a huge drop on the almost £650,000 it had in the bank at the end of the previous year and continues the steady decline from a peak of £21.1m in 2008.
JLR's plans are thought to have included developing a heritage centre for its marques at Silverstone, but negotiations stalled in August when it came to light Porsche could block rival manufacturers from using the track for more than 45 days each year.
It is understood JLR reversed out of talks for good on Friday, having decided a deal with the BRDC "did not fit" with its business requirements.
A source close to the deal confirmed Mr Tomlinson was no longer in the running, adding he "had extended his offer on numerous occasions and October 31 was his final extension". The source added: "He had been very clear that for there to be any realistic chance of saving the circuit business, a deal needed to conclude before the end of the year."
Ginetta Cars owner Laurence Tomlinson has also backed away from a deal with Silverstone Credit: Rex
The only remaining known bidder is Jonathan Palmer, owner of the Brands Hatch circuit in Kent.
The BRDC's financial woes comes despite the British Grand Prix hitting an all-time attendance record with 140,000 fans flocking to see Lewis Hamilton take victory in 2015. Despite this success, it is the only one of F1's 21 races which gets no government support, so it has to fund the estimated $25.5m annual hosting fee from ticket sales.
F1 supremo Bernie Ecclestone has a special agreement with the BRDC which sees it get a slice of F1's corporate hospitality revenue at the British Grand Prix. The price of its hosting fee also only rises by 5pc annually compared to 10pc for most other tracks.
Nevertheless, it has still driven combined net losses of £55.2m at the BRDC over the past five years. In the year to December 31, 2015 revenue rose 3.1pc to £56.4m but it finished £214,000 in the red.
The Northampton track is the current home of the British Grand Prix Credit: Getty
The accounts state that despite having net current liabilities of £20.4m the BRDC is a going concern. This is because it "relies on cash received from advanced ticket sales to fund its operations". They came to £10.8m at the end of last year and in a letter to members in August the BRDC's chairman John Grant said that "early sales for the 2017 GP are up strongly compared with this time last year".
In an attempt to stem its losses, the BRDC has been trying to sell a 249-year lease on Silverstone. At its AGM in September the board said it is considering remaining the landlord and raising funding from multiple partnership deals.
A decision on the preferred route is expected in the coming months.