Independent UK van maker LDV has secured new investment from Sun Capital amid fears of plant closure and is now focusing on long-term development.
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The investment makes the US private equity firm the majority owners of LDV for an undisclosed amount.
Production has been stopped for the past two weeks at the company’s Drews Lane plant, in Birmingham – with 700 of its 1,000-strong work force reportedly sent home.
The re-financing programme is designed to save these jobs and fund the production of new Maxus light commercial vehicles.
LDV will resume Maxus production ‘progressively’ this week while scrapping the older Convoy and Pilot ranges.
CEO Allan Amey said: “I am confident that we now have the right platform in place to pursue a sustainable long term growth strategy for the business.”
However, reports say the new owners could possibly sidestep liabilities arising from LDV’s GBP27.8m pension deficit.
According to the Sunday Telegraph, pension payments are on the line because its previous backers – including 3i, Barclays and Lloyds TSB – placed LDV into administration for an hour, which might enable the new owners to side-step pension fund liabilities.
The finance package will enable LDV to accelerate a new model development programme with a range of minibuses being introduced in 2006 and chassis cab derivatives to follow.
The Maxus range was originally designed in a joint venture with now-defunct Daewoo Motor and production was originally planned for Poland. After Daewoo failed, LDV paid to have the tooling for the new line brought to the UK and launched the model here about a year ago.
LDV is descended from the Leyland vans operation and was formed as a privatley held company after the Leyland-DAF joint venture failed in the early 1990s. Its older van models have a passing resemblance to the 1980s Leyland Sherpa, from which they evolved.
The company has enjoyed some success as a supplier of vans to the UK Post Office and its models have been exported as far away as New Zealand.
