Fleet News

US investment group buys LDV

VAN maker LDV has been bought out by an American investment group, in a move aimed at securing its future.

Under the terms of the deal, the firm went into administration and was immediately bought out by private equity consortium Sun Capital Partners.

The new owners will continue to employ the 1,200 staff at the Washwood Heath plant in Birmingham.

LDV recently stopped its production lines, saying it had to sell surplus stocks of vehicles and train new staff, but the move prompted fears that the company faced a cash crisis. Production has now started again.

Sun has taken a majority stake in the business, while a minority share now belongs to European Acquisition Capital.

However, pensions were not part of the deal, which has raised concerns. LDV has a pensions deficit of £27.8 million.

LDV chief executive Allan Amey was quoted in the weekend press as saying the deal would help the company to pursue a sustainable long-term growth strategy.

Its focus will now be on the Maxus van, and it will stop making older models such as the Convoy and Pilot. Customers who have ordered Convoy and Pilot will be given equivalent Maxus models.

LDV was created in 1993 after a management buyout from the now-defunct Leyland Daf. Ten years later, the company was refinanced through a partnership between European Acquisitions Capital and Barings England Growth Fund, along with original private equity partner 3i. In recent years, the company and its backers have invested £500 million in product development and new facilities.

LDV makes 12,000 vehicles a year, but hopes the deal can increase production to 14,000-15,000, as two new models – a minibus and a chassis cab – are introduced.

It had planned to start production of these models at the end of 2006, but the deal could mean production is brought forward by six months.

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