The “Phoenix Four”, the four men who own MG Rover’s parent company, Phoenix Venture Holdings, have pledged £49 million ($92.6m) in assets to help keep the troubled firm going and Rover’s administrators, PricewaterhouseCoopers (PwC), said they had a letter committing the £49 million, the BBC reported.
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The broadcaster noted that PwC said there were a number of legal hurdles that would have to be overcome before the “Phoenix Four” could make the assets available – they could be used as collateral to help secure loans for Rover.
The BBC said PwC are now looking for a buyer for Rover, which went into administration on Friday, and hoping to reopen talks with Shanghai Automotive Industries Corporation of China, which last week pulled back from investing large sums in the Birmingham-based car company, though PwC says its circumstances have changed since going into administration.
The UK government has said it will loan MG Rover £6.5 million to keep it as a going concern and pay staff wages for a week but administrators and the unions said it could take three weeks to do a deal, meaning at least £13 million more would be required, the BBC added.
The BBC said Monday’s move by the four Phoenix directors, led by John Towers, former chairman of MG Rover, appears designed to counter criticism that they have benefited at the car maker’s expense – the four have made about £40 million from Rover, in a combination of pay and benefits.
Most of the assets they have pledged are thought to belong to Phoenix Venture Holdings, in which the four are the main shareholders, the report said, adding it is not yet clear whether PwC will be able to accept their offer because of legal considerations.
According to the BBC, the Financial Times said the £49 million in assets pledged by the Phoenix Four included Studley Castle in Warwickshire [a conference centre], £1 million in cash and £25 million in “collateralised cash”.
However, there was no guarantee that even with extra loan finance, Rover would be bought by another company, the broadcaster noted.
