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John Edmonds of the GMB
"The DTI should not be impartial, it should be supporting industry"
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The BBC's Stephen Evans
"Alchemy thinks it is now in the bag"
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John Moulton and John Hemming
"There will be many other consequential job losses"
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Tuesday, 25 April, 2000, 19:46 GMT 20:46 UK
Byers pleads Rover cause
Many of the job losses will be at Longbridge
Unions hope the Phoenix bid will mean fewer job losses
The UK Government has urged BMW to allow more time to find a future for thousands of Rover workers threatened with redundancy.

BMW has said all bids for Rover must be in by Friday and expects negotiations to be concluded shortly with venture capitalist firm Alchemy Partners.

Mass production at Rover [as proposed by Phoenix] would require a 200,000 subsidy per man per year to be viable

John Moulton, Alchemy Partners

The Trade and Industry Secretary, Stephen Byers, telephoned BMW executives on Tuesday to try to persuade them to postpone the sale.

BMW has now agreed to meet on Wednesday with the rival Phoenix consortium, who want more time to finalise a rescue package they say could save thousands of jobs at Rover's Longbridge plant in the West Midlands.

BMW earlier said it wants details about financial support for the Phoenix bidders.

"What we actually need is clarification on financial backing," a Munich-based BMW spokesman said late on Tuesday.

But without an extension, the consortium is unlikely to complete financial checks on Rover Group which it needs to secure financing.

The trade secretary told Walter Samann, the Rover chairman, that he hoped the Phoenix bid would be treated fairly.

In a statement, Mr Byers said: "We want any new owner of Longbridge to be viable, retain the largest number of jobs possible and keep high volume car production."

Representatives of the Transport and General Workers' Union (TGWU) also plan to travel to BMW's head office in Munich on Wednesday to ask them to extend the deadline.

Every extra day of owning Rover is said to cost BMW about 2m in losses.

Mass production

Phoenix, headed by former Rover chief executive John Towers, wants to preserve mass car-making at Longbridge.

The proposals are said to include production of up to 250,000 cars each year.

John Hemming, a member of the Phoenix Consortium, told the BBC's Today programme that the group hoped to bring Rover back into profit by 2002.

He said Rover Group's losses in 1999 were nearer to 170m, rather than the 700-800m quoted by BMW.

There would be 1,000 to 2,000 redundancies from the 9,000-strong workforce - less than half those thought likely under the Alchemy plans.

But John Moulton, managing partner of Alchemy, derided Mr Hemming's calculations, dismissing them as "a piece of nonsense".

He said the Phoenix proposal would require a 200,000 subsidy per man per year to be viable.

He accused the Phoenix team of not knowing the real state of financial affairs at Rovers

Asked whether Alchemy would "blow the Phoenix bid out of the water" he said: "We will not blow them out of the water, because they are not even in the pond".

Union plea

Tony Woodley, chief Rover negotiator for the TGWU, said he wanted a one-month extension to the deadline.

"BMW is making it impossible for Mr Towers because they want to see cash up front," Mr Woodley said.

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

The move comes after the Phoenix bid was reported on Monday to be on the verge of collapse.

John Hemming, a Midlands businessman involved with the Phoenix bid, told the Financial Times an extended deadline was crucial.

Without more time the group could not guarantee its overdraft, he said.

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

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.

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See also:

24 Apr 00 | Business
Unions pledge fight for Ford
17 Apr 00 | Business
Alchemy plans sports car
13 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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