Pension black hole may end Rover deal

A €580 million pension black hole could scupper a rescue deal for ailing car group MG Rover, it emerged yesterday.

Shanghai Automotive Industry Corporation (SAIC), the potential Chinese partner of MG Rover, fears it could become liable for the pension deficit if MG Rover goes insolvent after it signs a joint venture deal with the company, weekend reports said.

British government ministers have raised the prospect of offering a €145m bridging loan to SAIC to help MG Rover to stay in business until the deal with the Chinese was completed.