Fleet News

Legal quagmire ahead over MG Rover sale

NANJING Automobile, which won the bidding war to take over MG Rover, could face legal challenges from the other companies hoping to secure ownership.

Administrators PricewaterhouseCoopers (PwC) selected the Chinese state-owned firm after lengthy negotiations.

But Nanjing could still face legal challenges from the favourite to buy the firm, Shanghai Automotive Industry Corp (SAIC), and the third main bidder, Project Kimber. Nanjing plans to move the Powertrain research and development arm to China but restart production of MG cars in Britain, possibly bringing 2,000 workers back to Longbridge.

SAIC is furious, claiming its bid was superior and is calling on all bids for MG Rover to be published.

The Independent quoted David James of Project Kimber as planning to submit a new bid for MG Rover despite PwC’s decision. But PwC maintains the deal is solid.

Debate over who owns which parts of MG Rover could further stall Nanjing’s progress. Japanese giant Honda, which claims to own many Rover design rights, has repossessed equipment and blueprints vital to building MG ZS/Rover 45s.

The Rover 400, upon which the 45 is based, was itself derived from the Honda Civic. Another dispute is over the intellectual property rights to Rover 25 and 75 production.

SAIC paid £67 million for most of Rover’s designs and claims this includes MG variations – the ZR and ZT – but Nanjing denies this.

Meanwhile, BMW owns the rights to the Rover name. Sources close to Nanjing say cars in the UK would bear the MG badge, while Chinese vehicles could revive the Austin marque.

Nevertheless, Nanjing is recruiting a UK management team and seeking partners for its plans to produce cars in the UK.

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