Tuesday, June 09, 2009
'Vast majority' of LDV jobs to go
The "vast majority" of vanmaker LDV's 850 employees will be made redundant, administrators have said.
A court placed the Birmingham-based firm into administration earlier, after its Russian owners said they had run out of options to rescue company.
There are a further 1,200 people employed at the chain's dealerships, with some 4,000 people supplying parts.
Administrators said they were talking to "interested parties" who may be able to take on part of the business.
These included Weststar, the Malaysian firm with which talks broke down at the last minute a week ago.
"Sadly we do not have the funding necessary to keep employees on, so it is with great regret that we place ourselves in a position where we will have to make redundant later today the vast majority of the workforce," a representative of administrators PriceWaterhouseCoopers said.
LDV's Washwood Heath plant has been at a near-standstill since before the end of 2008 during the search for a new owner.
Since 2006 the firm - formerly Leyland DAF Vans - has been owned by Russia's Gaz Group, controlled by Oleg Deripaska.
A Gaz spokesman said it was "a sad day for the LDV workforce, suppliers and British manufacturing".
'Potential'
LDV managers and workers were angered last week when they were forced to cancel a planned lobby of Parliament because of Prime Minister Gordon Brown's cabinet reshuffle.
Directors had hoped to persuade the government to agree to a £60m loan to secure the firm, but no ministers were available to meet them.
The firm claimed the loan would have cost the state much less than the collapse of the business will.
"The management team have worked exceptionally hard over the past few weeks and months but, despite every effort made around the globe, they've been unable to obtain the required funding from the banking system," said the firm's marketing manager, Guy Jones.
"Like much of industry, its access to this working capital remains an issue, which will go on to cause further job losses if not addressed."
He added he hoped that potential buyers would recognise "potential" in the firm and insisted there was the opportunity for "a bright future".
Administration benefits
Weststar had agreed a deal to acquire the company from its Russian owners, with the aim of restarting production in July.
The government pledged a £5m four-week loan until the deal was sealed, after the firm said it intended to maintain production at the Birmingham plant and expand manufacturing in Malaysia.
However, Weststar pulled out of the takeover last week.
It has not commented on reports that it planned to swoop for LDV once it was in administration - a move which would mean it took on the firm with fewer debts.
"The benefit of buying a company out of administration is that the buyer is not taking on any liabilities and is able to only take the 'good bits'," said Alan Tomlinson, partner of licensed insolvency practitioner Tomlinsons.
DATED: 09.06.09
FEED: AW
