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John Hemming of the Phoenix consortium
"Our estimate is that we can get into profit by 2002"
 real 28k

John Moulton of Alchemy
"I don't thint we will blow them out of the water, they're not even in the pond"
 real 28k

Monday, 24 April, 2000, 16:26 GMT 17:26 UK
Rival Rover bid 'set to collapse'
Many of the job losses will be at Longbridge
Unions hope the Phoenix bid will mean fewer job losses
The Phoenix consortium bidding to take over the Rover car company believes its rescue attempt is on the verge of collapse, reports say.

On Monday, German car giant BMW said it expects to conclude negotiations with venture capitalists Alchemy soon.

Unions and politicians have called on BMW to allow more time for the Phoenix consortium bid, headed by former Rover chief executive John Towers, to be finalised.

Unions now plan to fly to BMW's Munich head office on Wednesday, to ask them to extend the Friday deadline.

The Towers' proposals are said to include production of up to 250,000 cars each year, with 1,000 to 2,000 redundancies from the 9,000 strong workforce - less than half those thought likely under the Alchemy plans.

Deadline looming

BMW now looks unlikely to extend its deadline beyond this week.

"Alchemy was our first partner and we want to conclude negotiations with them as soon as possible. The negotiations should be concluded soon," a BMW spokesman said on Monday.

Without more time to do due diligence on hundreds of millions of pounds of assets, the group could not guarantee their overdraft and the bid would fail, John Hemming, a Midlands businessman involved with the Phoenix bid, said in the Financial Times.

"If we can't get the overdraft guaranteed, we won't be able to pay anyone, so it would be not good at all," he said.

Union anger

Union anger at the government and BMW has mounted, with unions claiming that the government has not done enough to save jobs either at Rover or Ford.

Trade and Industry secretary Stephen Byers will urge BMW on Tuesday to halt the sale of Rover to Alchemy to give Phoenix more time to get its financing complete.

Monday's edition of The Times said he would speak to BMW executives in Munich over the issue.

Tony Woodley, chief Rover negotiator for the Transport and General Workers Union, said he wants a one month extension to the deadline.

"BMW is making it impossible for Mr Towers because they want to see cash up front but you cannot get money until you have carried out due diligence. We hope to send a delegation to Munich to plead for more time," Mr Woodley said.

Bill Morris, general secretary of the Transport and General Workers Union, said: "Alchemy have had six weeks to work up their financial package. The Towers team should be given the same opportunity."

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See also:

23 Apr 00 | Business
Unions pledge fight for Ford
17 Apr 00 | Business
Alchemy plans sports car
12 Apr 00 | UK Politics
Byers 'not guilty' over Rover
09 Apr 00 | UK Politics
Millions to retrain Rover workers
20 Apr 00 | Business
Rover jobs crisis
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