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Tuesday April 19, 10:01
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Rover’s entering administration puts more workers at risk
(by Brigitta Zulfitzler)
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Phoenix Venture Motors, which owns 11 car dealerships, is the fourth Phoenix Venture Holdings business to peg out since PricewaterhouseCoopers was called into MG Rover 10 days ago.
MG Rover’s main liability is a £427m interest-free loan provided by BMW when the Phoenix directors acquired Longbridge in 2000.
However, the BMW loan was practically made to a master company Techtronic 2000, established by John Towers, the chairman of PVH, and his three fellow directors. "Since Techtronic 2000 is payable and has no costs or expenses, there is no issue," said a spokesman for PVH.
A BMW spokeswoman also said: "The loan is still in place and will not appear in the list of creditors being drawn up by the administrators".
Recently the investigation found out that in addition to £427m the Phoenix four, led by John Towers, received another £102m on June 1, 2001. The payment was arranged when BMW (UK) Holdings purchased a single share in the Powertrain engines business and in MG Rover Group.
The company has declined to comment on the newly identified £102m injection.
Paul Boyle, chief executive of the FRC, noted yesterday that the investigation should not be regarded as a detailed probe of any alleged financial manipulations at the Longbridge car-maker but only a look over the accounts.
He refused to reveal the term of the investigation.
With the start of the investigation, hundreds more jobs were put at risk as another Rover company, Phoenix Venture Motors, was placed in administration yesterday.
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