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Last Updated: Tuesday, 6 January, 2004, 18:52 GMT
MG Rover sells Longbridge land
Longbridge plant
The deal is the third sale of land at Longbridge in under two years
The Birmingham car maker MG Rover has sold most of its Longbridge site to a property developer.

The sale, which was revealed on Tuesday, saw St Modwen Properties pay 42.5m for all but 20 acres of the 248-acre complex.

The car group plans to rent the land back from St Modwen and reinvest its windfall in the business.

MG Rover lost 100m in 2002 and this is the third land sale made by the company in under two years.

In April 2002, MG Rover's parent company, Phoenix Venture Holdings, sold 42 acres of surplus land for 11.3m and disposed of a further 18 acres for 5.6m in December last year.

Long-term lease

Both sales were agreed with St Modwen and regional development agency Advantage West Midlands, which plans to build a high-technology business park on the site.

MG Rover chief executive Kevin Howe confirmed the deal would generate cash for product development.

He said: "It puts to work one of our assets, but in no way restricts the day-to-day running of our business."

The company, which was bought for 10 from BMW by a consortium of local businessmen in May 2000, has a long-term lease of up to 35 years on the site at an initial rent of 3.6m and an option to renew.

Engine plant

Richard Froggatt, executive director of St Modwen, said the latest transaction was very similar to its other sale-and-leaseback deals with industrial giants such as Corus, Goodyear and Alstrom.

"We set up a partnership with MG Rover in 2001 to regenerate land which was surplus to operational requirements," he said.

"We are delighted to extend our relationship with MG Rover to support the ongoing operations."

It is believed the latest deal does not include the 186 acres occupied by the Powertrain engine plant.




SEE ALSO:
MG Rover shuts production early
12 Dec 03  |  Business
Plan for 100m business park
14 Nov 03  |  West Midlands
Unions meet Rover bosses
19 Nov 03  |  Hereford/Worcs
Rover faces pension fund talks
11 Nov 03  |  West Midlands
India firm rolls out next Rover
17 Sep 03  |  Business
Rover's 75,000 car goes on sale
01 Nov 03  |  West Midlands


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