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Last Updated: Friday, 8 April, 2005, 14:04 GMT 15:04 UK
'Little' of value left at Rover
Studley Castle
Studley Castle is one of the property assets Rover still owns
As accountants prepare to sift through Rover's assets many industry commentators wonder what there is left to salvage from the stricken car maker.

"There isn't a lot left," Phoenix Consortium vice-chairman Peter Beale said after the group called in advisers from PricewaterhouseCoopers (PwC).

Rover does not own the ground it builds cars on at Longbridge, having sold it off for 57m before leasing it back.

Nor does it own its brand name - former owner BMW kept that.

Even the vast number of properties it owns and rents to Rover dealerships are so heavily mortgaged that a recent attempt to sell them fell through because the offer was not enough to make it worthwhile.

There isn't really a great deal left
Dr Tom Donnelly, Coventry Business School

St Modwen Properties, which leases the Longbridge site to MG Rover, said it was "unlikely" that the site would find a buyer to keep the factory running.

It said redevelopment of the property seemed inevitable. St Modwen bought a 228-acre tranche of the 275 acre Longbridge site in January 2004. MG Rover pays an annual rent of 5m back to the property group.

Dwindling assets

While most carmakers own their own finance arm, Rover has already lost its own unit.

In a controversial transaction, BMW sold Rover's car finance firm MGR Capital directly to the four directors of the Phoenix consortium with the backing of a bank.

I don't think it is going to be sold as a going concern
Professor Garel Rhys, Cardiff University

"The parts business was sold off to Caterpillar, so they don't make any money out of their own parts," Nick Matthews industry expert at the Warwick Manufacturing Group pointed out.

"All the real asset value has been switched out of the manufacturing company."

In short, millions of pounds worth of assets have already flown the nest.

Dr Tom Donnelly of Coventry Business School added: "The interesting thing will be - and this is where accountants are going to have a lot of fun - is where's it all gone?"

Uncertain future

The company Rover hoped would save it from the brink, Shanghai Automotive Industry Corporation (SAIC), owns the rights to build two of its models - the Rover 25 and the Rover 75 - together with the right to build Rover engines.

"I don't think it is going to be sold as a going concern," said Professor Garel Rhys at the Cardiff University Business School.

One thing it does still own is the MG brand name. This was also due to be sold to SAIC and, priced at 50m, is one of the most valuable parts of the business.

The production lines themselves may attract buyers in developing countries where out-of-date models are still popular, but these will have deteriorated in value over the years. Their value is likely to be worth around 10m.

Another, albeit unlikely, property asset that Rover does still own is Studley Castle, a Warwickshire stately home which is used as a hotel and conference centre. This is thought to be worth about 8m.

It also has showrooms on Park Lane, London, and the Champs-Elysees in Paris.

"The Chinese have bought the K-series engine and they've already got access to some of the intellectual property," said Dr Tom Donnelly, director of the motor industry observatory at Coventry Business School.

"There isn't really a great deal left."




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