Wednesday, May 06, 2009
Sale of van maker LDV is agreed
The sale of Birmingham-based van maker LDV to Malaysian firm Weststar has been agreed, a company spokesman has said.
LDV marketing director Guy Jones said the deal would secure production in Birmingham, although he could not guarantee all jobs would be saved.
The UK government will provide a £5m four-week bridging loan to allow time for the takeover to be completed.
Moves to put LDV into administration were adjourned for a week at a court hearing earlier.
Mr Jones said the deal would take another couple of weeks to finalise and no date had been set for production to restart.
"Weststar's proposed purchase of LDV offers the only credible chance of keeping this manufacturing plant in the UK, sustaining UK jobs and a platform for future model development," said Business Minister Ian Pearson.
It is understood LDV and Weststar had reached a deal earlier in the week, but that it relied on the government financing.
The government has made it clear the £5m is a one-off bridging loan that cannot be extended.
'Significant development'
LDV had been due to go into administration at a hearing on Wednesday, but the hearing was pushed back to 13 May.
A court hearing was told that LDV's Russian owner Gaz had sold its stake in the firm to Weststar.
LDV's Mr Jones said the moves were "a significant development for LDV and a major step towards an exciting new future for the company".
However, he added: "We cannot stand here today and guarantee the jobs. The marketplace will determine how many jobs are required."
LDV employs 850 workers and is also a key customer for many suppliers. It employs 1,200 people in dealerships.
The chief executive of the Society of Motor Manufacturers and Traders, Paul Everitt, said the rescue deal was a vote of confidence in the industry.
"I think it does signal that there are now investors out there taking a longer term view and they see the UK motor industry as being a good investment - an industry that has a strong future," he said.
DATED: 06.05.09
FEED: AW
