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US, Arab, Canadian Companies to Invest EUR 1 B in Bulgaria's Formula One Project
US, ARAB, CANADIAN COMPANIES TO INVEST EUR 1 B IN BULGARIA'S FORMULA ONE PROJECT
Date: 28/10/2010
Source: novinite.com
US, Arab, Canadian Companies to Invest EUR 1 B in Bulgaria's Formula One Project

Companies from Abu Dhabi, the USA, and Canada are to come together to form a consortium for investing in Bulgaria's circuit for Formula One and adjacent venues, Novinite.com (Sofia News Agency) learned.

In an exclusive interview for Novinite.com (Sofia News Agency), Bogdan Nikolov, Chairman of the Bulgarian Motorcycling Federation, revealed that the Abu Dhabi company EABG, which first expressed interest in investing in Bulgaria's F1 project in August 2010, will be forming a consortium of Arab, American and Canadian companies for investing in Bulgaria's future Formula One track.

Anwar Badwan, an adviser to EABG, who is organizing the consortium, confirmed for Novinite.com (Sofia News Agency) over the phone the information that US and Canadian companies will be participating in it.

The expected investment of the consortium in the Bulgarian Formula One track project could surpass EUR 1 B, including not just the circuit but an entire new town north of Sofia with 7000 luxury villa and a number of entertainment and shopping venues.

The representatives of the Abu Dhabi companies are said to have spent 20 days in the US negotiating for partnership with American and Canadian firms.

The head of the BMF, Bogdan Nikolov, who has been a major figure in initiating the project on Bulgaria's part, and has been involved in talks with FIA for a Bulgarian Formula One Grand Prix, told Novinite.com (Sofia News Agency) that the international consortium, and the Bulgarian government have to finalize their agreement, and then to sign a contract for hosting a Formula One Grand Prix with Bernard Ecclestone, the President and CEO of Formula One management and administration.

"Everything is almost ready. We have the project for the racetrack. There are four contracts to be signed – for TV rights, for commercial rights, for advertising, and the main one – for hosting the race. Those have been drafted. The contract for hosting is right here, sent to us by Mr. Ecclestone, we only need to write the name of the other party. So everything depends on whether we will make it. We still have time but it is not much," Nikolov said.

He pointed out that according to the talks the Bulgarian government will not contribute any funds but only non-cash assets to the future joint-stock company, namely, the 320-hectare plot of the former military air field at Dobroslavtsi near Sofia. It will also most likely provide a 10-year gratis period of tax exemption for the investors.

Nikolov revealed that the potential Bulgarian Formula One track, designed by Belgian specialists, will be absolutely unique in that it will be the only one in the world with heating of the asphalt covering, which should make it very attractive for tire producers to test their tires in various temperatures.

If the talks for the forming of the international consortium and the role of the Bulgarian government work out, FIA head Bernard Ecclestone should be expected in Sofia to sign the contract for the Bulgarian Grand Prix as of 2012 between November 15 and December 15, Nikolov said. Bulgaria is also expected to host a Moto GP race on the same track in 2012.

"The circuits for Moto GP and Formula One are basically the same with small differences in the safety zones. The safety zones for Moto GP tracks are larger and longer. We have created a project that meets the requirements of both FIA (Fédération Internationale de l'Automobile) and FIM (International Motorcycling Federation) for a circuit for Formula One and Moto GP. If 365 days in the year, the track must be in use 220 days in order to be a profitable investment. The climate in Sofia allows that," the BMF Chair said.

He also disclosed that the future Bulgarian Formula One track will be built to fit 100 000 spectators.

In August 2010, representatives of the Abu Dhabi consortium EABG (Emirates Associated Business Group), visited Sofia and expressed interest in investing in the project, meeting with the Bulgarian Prime Minister Boyko Borisov and Economy Minister Traicho Traikov.

Subsequently, however, the situation unraveled into a scandal as mainstream Bulgarian media confused the title of EABG chair Mohammed Abdul Jalil al Blouki, and EABG official Anwar Badwan received death threats from two Bulgarians living in Chicago, who were exposed, but according to the Interior Minister, were making a joke.

Despite the scandal, in September, Badwan made it clear that the Abu Dhabi consortium is still interested in investing into a Formula One track in Bulgaria.

According to Nikolov, the entire scandal was invested by "competitive" interests that wanted to hurt Bulgarian Prime Minister Boyko Borisov. However, he refused to comment in detail on who might have engineered the scandal.

"If there is Formula One Grand Prix in Sofia, there won't be races on Istanbul Park and Hungaroring. We will be the only Grand Prix in Eastern Europe," Nikolov said.


Topic: Business



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