The company behind the Circuit of Wales, Heads of the Valleys Development Company, has submitted the requested names of private investors to Welsh Economy Secretary Ken Skates, and their latest funding plan will now be examined in detail before a final decision is made.
HOVDC were handed a two-week deadline by Mr Skates in January to deliver proof of private investment after submitting a funding plan that would see the Welsh Government underwrite less than 50% of the £425million needed for construction on the Ebbw Vale circuit.
Though happy with the latest deal, Mr Skates has said that a process of ‘due diligence’ will be carried out in order to confirm the project’s value for money, as well as checks into just how many of the 6000 predicted jobs associated with the circuit will in fact be created if the project does go ahead.
It is thought that this will take anywhere between six and eight weeks to complete, though a spokesperson from the Circuit of Wales is confident of construction beginning in Spring.
“The deal that is on the table is certainly better than the one that was presented back in July,” said Mr Skates. “I think it justifies the position that was taken back then when we were presented with a request for guarantees amounting to 83%, which is more than £100million in guarantees than what we have been able to drive through with this deal.
“However, due diligence is required as is normal in any project of this type to give confidence that the investment, the potential guarantee draw down, is something that the tax payer is comfortable with, something that we are comfortable with.
The Circuit of Wales signed a deal with MotoGP owners Dorna Sports back in 2014 to take over hosting duties of the British Grand Prix from the 2016 season onwards, with the circuit organising the 2015 race at Silverstone. However, delays with an environmental enquiry and the constant rejection of its funding plans has meant construction is yet to even begin on the circuit. Silverstone will again be the scene of the British Grand Prix this year, with it looking likely to be called on once more for 2018.
Despite struggles with the project, the Circuit of Wales attracted backing from private bank Kleinwort Benson and Extreme Company last year.
It is hoped that the partnership with Extreme will see an entertainment park – equipped with stages for live music and an indoor ski slope, amongst other things – constructed alongside the track to attract even more visitors to the area annually than the 750,000 touted for racing activities. This should reduce the risk of the project and ultimately see an even bigger boost to the Welsh economy.
Though the project’s future is still up in the air whilst the examination into the funding plan is carried out, this latest development is at least a step in the right direction.
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