'We're moving in right direction' - Towers
JOHN Towers said his Phoenix consortium had held "detailed and positive" talks at the London offices of BMW's solicitors, yesterday aimed at securing the future of Rover and that things were 'moving in the right direction'. Mr Towers said relatively few items had been identified for the two teams to work on in the next few days. But according to The Guardian newspaper, the bid is being thwarted by British banks' refusals to grant a £200m overdraft and Phoenix had had to hold emergency talks with US and Canadian banks for help with the bid. The Phoenix consortium -- which includes a director of car bodies firm Mayflower, two Rover dealers and racing car group Lola -- has not discussed the financial details of its bid. But industry experts say it needs £700m to sustain its plans to keep Rover output at about 220,000 cars per year and save thousands of jobs which would have been shed under Alchemy's ownership. A bid by Phoenix group to buy carmaker Rover from BMW is being thwarted by British banks' refusals to grant a 200 million pound overdraft, according to the Guardian. The newspaper said Phoenix, which held its first day of meetings with Germany's BMW on Tuesday, had been forced to hold emergency talks with U.S. and Canadian banks for help with its bid. Today's Financial Times says that hopes for government aid were fading after warnings that any such move would be blocked by the European Commission. The FT cited British officials in Brussels as saying that the European Union's competition commissioner, Mario Monti, would block any government grant applied for under EU rescue rules -- normally reserved for companies facing collapse -- since Phoenix is not a company in that position. BMW has said this morning that it will deal with the Phoenix bid for Rover with 'great emphasis'. " All parties, the state, the employees, the trade unions, the suppliers and our dealers will have to contribute their share," said the company. Prof. Sämann once again pointed out the necessity to take advantage of this chance together: "At the moment, this path does not only present itself as passable, but is also the only possibility, to continue Rover Car Operations in the desired sense - otherwise a closure is unavoidable."
Article Date: May 03, 2000