Tech firm plans research hub at Circuit of Wales
ONE of the world’s biggest technology firms, Thales, plans to create a research and development hub at the proposed Circuit of Wales, if the project in Blaenau Gwent is given the goahead.
The Western Mail has obtained details of the proposed project from the company which employs 62,000 worldwide in the security, aerospace, transport and defence markets.
The plans from Thales form part of the final bid document from the company behind the racetrack and associated one million sq ft technology park, Head of the Valleys Development Company (HOTVDC), to the Welsh Government.
The company is seeking just under 50% of underwriting support for the £425m racetrack project from the Welsh Government – at around £210m.
Global asset management firm Aviva Investors has, in principle, committed £280m towards the project, for which the whole of the Welsh Government’s underwriting would apply.
The rest of the project’s funding would come from around £60m in equity investment – including from chief executive of HOTVDC company, Michael Carrick – and around £85m in debt finance.
It is understood that this debt element would come from a Korean investment bank.
Among Thales clients are Williams Formula One team, Jaguar Land Rover and the MoD.
Its supporting document in HOTVDC’s business case to the Welsh Government says: “Thales would provide an R&D hub and this would deliver the construction of a TrustLab as part of the circuit’s technology enterprise centre.
“The Trust-Lab is a customer engagement, co-innovation and technology lab facility that enables the exploration of digital transformation challenges and technology development.”
Thales said the proposed facility would promote innovation through collaboration with the private sector in Wales, including SMEs as well and the higher and further education sectors.
The documents seen by the Western Mail don’t specify the level of the proposed investment or direct and indirect jobs that the project could create. However, they do show that Thales could also be a supplier to the proposed racetrack and innovation park in terms of digital infrastructure and ongoing support.
The Circuit of Wales, when contacted, declined to comment on any potential investment from Thales. However, a spokesman said: “Whilst we cannot comment on individual organisations, we can confirm that we are in discussions with many leading global businesses across a broad range of sectors.
“These are companies who are interested in basing themselves at or making a significant contribution to the Circuit of Wales, its infrastructure and events. We look forward to announcing exciting agreements and partnerships in the near future.”
Thales were contacted for comment.
The negotiations over the last year with the Welsh Government have been led by Circuit of Wales chief executive Martin Whitaker and former chairman of Network Rail and global chief technical officer for Ford, Welshman Richard Parry-Jones.
Due diligence on the project’s latest business case is being carried out for the Welsh Government by professional advisory firm Grant Thornton. It is unlikely to give a definitive recommendation to Economy Minister Ken Skates as to whether the Welsh Government should underwrite or not.
Mr Skates will report the findings on the due diligence – the final in a number undertaken on the project over the last few years – to a Welsh Government cabinet meeting, possibly in the week after the General Election of June 8.
It will then be a collective cabinet decision as to whether to provide underwriting support for the project, or not.
For the underwriting, which would apply for 33 years – although its level would depreciate over time – HOTVDC, would effectively pay a dividend to the Welsh Government of £131m (over 33 years).
In its only public statement on the project to date, Aviva said: “The Circuit of Wales scheme has the potential to transform the local area and economy, and we remain hopeful of a positive outcome to negotiations with all parties involved on the project.”
It wouldn’t comment when asked if it would consider providing £280m of funding for the project if the Welsh Government opts not to provide underwriting support.