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"Now the hope is the rival bid is back on the table"
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"The presumption was the deal would be done today""
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Friday, 28 April, 2000, 12:58 GMT 13:58 UK
Byers urged to act over Rover
Longbridge workers demonstrate to save their jobs
Longbridge workers demonstrate to save their jobs
Trade and Industry Secretary Stephen Byers is facing calls to intervene in the Rover crisis as an "honest broker" after the collapse of take-over talks between BMW and venture capitalists bidding for Longbridge.

Richard Burden, the MP whose constituency includes the beleaguered plant, said that the onus was on BMW as a "credible international company" to negotiate with the Birmingham-based Phoenix group to save the plant.

Opposition politicians also called on the government to act to ensure that the Phoenix case is heard at BMW's Munich headquarters.

The calls for Mr Byer's to act came after venture capitalist group Alchemy Partners dramatically pulled out of the Rover deal because of unresolvable "contractual" differences with BMW.

BMW has so far refused to negotiate with Phoenix, headed by former Rover director John Towers, saying that it remains unconvinced by its financial package. The company has now put a month deadline on finding another buyer for Longbridge.

Trade and Industry Secretary Stephen Byers has yet to comment on the development, but his department issued a statement saying that there was now a "new opportunity" to find a viable future for Longbridge.

Mr Burden said that Alchemy's pull-out presented BMW with an opportunity to start serious negotiations with Phoenix.

"This is a very dramatic development, but we have seen throughout this saga that one thing has been said and then another thing has been done.

"The people who have been the casualties in all of this are the workers and their families who have been kept in an absolutely appalling state of uncertainty - nobody should have to be put through that."


Mr Burden said that Phoenix had been in a Catch-22 situation - turned down by BMW because of an incomplete financial package, but unable to present clearer figures because of BMW's exclusive Alchemy negotiations, including keeping detailed accounts confidential.

"BMW should reveal that information and start negotiations straight away," said the MP.

"Jobs will be lost at Longbridge whatever happens but we owe it to the people here to do all that we can.

"If Alchemy has pulled out, BMW has to negotiate with Phoenix. It's up to BMW to ensure that the bid is considered properly."

"Honest broker"

Vincent Cable, Liberal Democrat trade spokesman, said the development was "potentially good news" but Mr Byers now had a responsibility to act as "honest broker" to ensure that the Phoenix bid was properly considered.

Bill Morris, general secretary of the Transport and General Workers Union, said that BMW's deadline caused him concern - but Phoenix now had the opportunity to prove its case.

"BMW still makes or sells 70,000 units every year in this country," he said. "Any company that wants to maintain that share of the market would be foolish to take the nuclear option that closure would represent."

Calling for Mr Byers to do all necessary, shadow trade and industry secretary Angela Browning said that Rover now faced an "all or nothing" situation if the government did not act quickly.

"This is potentially the worst of all possible outcomes following the concerns BMW has expressed about the financial viability of the Phoenix bid," she said.

"We call on all parties involved to redouble their efforts to reach a speedy agreement on the future of Rover."

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See also:

28 Apr 00 | Business
Alchemy bid timetable
16 Mar 00 | Business
Alchemy shies away from Rover risk
28 Apr 00 | Business
BMW, Alchemy: Full statements
26 Apr 00 | Business
Rover: 24,000 jobs at risk
25 Apr 00 | Business
Byers pleads Rover cause
20 Apr 00 | Business
Rover jobs crisis
28 Apr 00 | Business
BMW threat to close Rover Cars
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