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  Friday, 5 July, 2002, 18:28 GMT 19:28 UK
Late reprieve for Arrows
Arrows drivers Enrique Bernoldi of Brazil and Heinz-Harald Frentzen of Germany
Arrows may be on the Silverstone track after all

The Arrows Formula One team have won an 11th hour reprieve that will allow them to race in this weekend's British Grand Prix.

The news came after a day of talks between Arrows and engine supplier Cosworth.

Arrows owes Cosworth $4.7m in unpaid bills, but a compromise deal has been brokered with the help of F1 boss Bernie Ecclestone.

Arrows boss Tom Walkinshaw
A frantic Friday for Arrows boss Tom Walkinshaw

Arrows boss Tom Walkinshaw refused to comment on Friday evening, but it is understood that he has told his team that they will be racing this weekend.

An announcement is expected on Saturday morning in time for the team to compete in qualifying.

That will ensure that Arrows do not have to miss the race, which would almost certainly have spelt the end of the team.

'Dire financial position'

But Arrows have been fighting to resolve a financial crisis after losing a High Court battle on Thursday and their long-term future remains very insecure.

The team's lawyers said following the judgement that the team is "doomed barring a miracle".

And Mr Justice Lightman declared that Arrows were in a "dire financial position" and in danger of collapse.

Walkinshaw is in dispute with the co-owner of the team, the investment bank Morgan Grenfell.

The bank served an injunction on Arrows to block Walkinshaw's attempts to bring in new investors to resolve a financial shortfall.

High Court hearing

In a damning judgement, the judge said that the management of Arrows "are responsible for the prolonged insolvent trading".

He added: "If Arrows goes into liquidation, administration or receivership, as appears practically inevitable, creditors may have to seek relief against the directors in proceedings for wrongful or fraudulent trading."

Jaguar team boss Niki Lauda, who also oversees Ford-owned Cosworth, had said Arrows were two months behind with payments for their engines.

The crisis was precipitated by Thursday's High Court hearing in which Arrows lost an application to lift legal undertakings made to a number of creditors in the Deutsche Bank group of companies.

Arrows had hoped to sell its rights to Formula One revenues to Red Bull sports drink boss and team sponsor Dietrich Mateschitz.

The judge ruled that claimants in the case against Arrows, and in particular Morgan Grenfell Equity Partners, had made a "substantial investment in the team which now totals some $60 million".

He added that "if the management of Arrows is placed in competent and honest hands...something of real value may be salvaged for Morgan Grenfell and other creditors".

Arrows have not won a race in 380 attempts and, with Germany's Heinz-Harald Frentzen and Brazilian Enrique Bernoldi as drivers this season, have scored just two points so far in nine races this year.

 WATCH/LISTEN
 ON THIS STORY
BBC Five Live's Peter Slater
"Arrows will race at home Grand Prix"
In-depth guide to the 2002 Formula One season

On-track action

Our man at Silverstone

Jonathan Legard

F1 2002
Links to more Formula One stories are at the foot of the page.


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