Last British carmaker to declare bankruptcy (DAMN IT!)
Been following this for the last three days, this suck big time! The Chinese company fell through now I don't know whats going to happen.
Basically they need money and theresso much the gov't can give, and now with the elections god knows what will happen. More talks today...
No more british carmakers...
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The directors of MG Rover were forced to admit defeat at lunchtime, when they formally announced that they had appointed the accountants, PriceWaterhouseCoopers, as administrators for the ailing business.
The car maker's future and that of its 6,000 employees had been in turmoil overnight, following conflicting statements from the board of directors and government ministers over its status, raising false hopes that it could be salvaged as a going concern.
The company had spent the past six months in detailed negotiations with the Shanghai Automotive Corporation Industries, of China, and the UK Government, trying to secure a £1 billion takeover deal to salvage the 100-year business.
It was clear from the moment the Phoenix consortium bought Rover in 2000 that they would need to find an external 'White Knight', because they lacked the resources to continue much beyond four or five years. In this they failed, and the company has no future
Dominic O'Connell, Industry Editor, The Sunday Times
arrow The British car industry
But the deal was delayed over a £100 million bridging loan from the British Government, aimed at tiding over MG Rover until the Chinese had assumed control. When the loan failed to come through, suppliers, anxious about whether their bills would be paid, stopped providing component parts to the Longbridge factory, precipitating the crisis when production was halted on Thursday.
While Patricia Hewitt, the Trade and Industry Secretary, announced last night that the company had been put into receivership, the company confirmed only that it had asked PwC to advise on options.
The company stuck by its position this morning.
The company's options must have been severely, as PwC were appointed as administrators within hours of the earlier statement.
The events of the previous evening only fuelled speculation and confusion over the company's outlook.
Ms Hewitt maintained that she had been informed by John Tower, the head of the Phoenix consortium which owns MG Rover, at 9.20pm yesterday that the receivers were being called in. It had been made "absolutely clear" to herself and to Tony Woodley, the leader of the Transport and General Workers’ Union who has been closely involved in talks over the car marker’s future, that the company was being placed in receivership.
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"We had no choice except to tell the workforce and the suppliers," Ms Hewitt told BBC Radio 4’s Today, before a visit to MG Rover's Longbridge plant in Birmingham. "They could not be kept in the dark any longer."
Mr Woodley also said that he was expecting MG Rover to be placed in administration. "We need to talk to the administrator who will inevitably be appointed later today," he said.
Administration and receivership, while both insolvency procedures, differ markedly in approach. While administration is aimed at protecting companies from their creditors while a restructuring plan is implemented and may allow the resurrection of a failed concern, receivership involves the sale of a business’s assets in an effort to meet debts.
PricewaterhouseCoopers has yet to confirm what action, if any, it will take at MG Rover. Although BMW, which sold Longbridge to Mr Tower’s Phoenix consortium in 2000, has retained rights to the Rover name, many accountants believe that the MG marque, which continues to brand a line of commercially successful sports cars, could be revived in a fresh venture.
While the Longbridge workers awaited for information on their futures, Ms Hewitt said that suppliers to the plant had already begun laying off staff. The Government announced a £40 million package to support the component makers, which employ an estimated 18,000 people.
The MG Rover crisis follows the failure to reach a rescue deal with the Shanghai Automotive Industrial Corporation. However, according to some reports, SAIC has said that talks with MG Rover are still ongoing.
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Not thats it's a real or proper car maker.