MG Rover has bought the 58,000-customer Rover Financial Services contract portfolio for £340 million from BMW through MGR Capital, a joint venture between HBOS and the Phoenix Partnership.

MGR Capital will manage the financing arrangements relating to the portfolio, and with MG Rover Group, the eventual disposal of vehicles at the end of their finance leases.

"This is an important step for the business to take," MG Rover Chief Executive Kevin Howe said. "It puts us in more control of second hand values which is a significant benefit to our business and our customers. It also creates many new marketing opportunities for the future."

Rover Financial Services, under BMW ownership, had been the finance provider for Rover, Mini and Land Rover customers since 1998. Ford bought the Land Rover assets in October 2001.

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