Ex-Phoenix Four consultant's firm buys LDV assets

The assets of stricken van maker LDV are to be sold to a company owned by a former consultant of the MG Rover Phoenix Four directors.

Administrators announced that they had exchanged contracts with Eco Concept – a vehicle engineering firm owned by China Ventures, headed by Dr Qu Li, who was revealed in last month’s Government report to have had a personal relationship with one of the Phoenix Four while working as a consultant for MG Rover.

Dr Li received £1.6m (€1.74m) for consultancy services to the Rover group in the 15 months before the firm collapsed.

LDV administrator PricewaterhouseCoopers (PwC) said it had secured the deal after nine weeks of “intensive” negotiations and was hopeful that the sale would complete within the next month.

However, PwC dealt a blow for hopes that production would be resumed at the Birmingham-based firm’s site at Washwood Heath, saying the new owner intended to relocate the assets.

LDV’s buyer, Eco Concept, said it wanted to launch a new company making specialist light vehicles, but a spokesman said the Washwood Heath site was not suitable for its planned smaller scale production operation.

Eco Concept is aiming to recruit around 200 workers for the operation at a new site in the West Midlands, although it is not yet clear if the firm plans to take on the 34 staff left at LDV.

Most of LDV’s 850 workforce were made redundant in June after the firm collapsed into administration following a failed rescue bid.

LDV, which was owned by Russia’s Gaz, suffered financial difficulties, culminating in production being halted in December.

A last-ditch rescue attempt failed in June after Malaysian company Weststar could not raise funds to buy the business.

PwC’s new owner, Dr Li, was said by Government inspectors probing the Rover collapse to have received “excessive” pay for her consultancy services at the firm.

The long-awaited Government investigation into the 2005 collapse of Rover, announced last month, concluded there was not enough evidence to pursue a criminal prosecution against the four directors, John Towers, Peter Beale, John Edwards and Nick Stephenson. The directors bought Rover for £10 (€10.93) from BMW in 2000.

Dr Li was born in China, obtained a degree from a Chinese university and worked for a number of companies before coming to the UK where she studied at Leeds University.