Alchemy dismissive of rival bid for Rover

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The Independent Online

The venture capitalists who want to take Rover cars off BMW's hands said today that they don't feel threatened by a rival bidder for the beleaguered car company.

Alchemy Partners chief Jon Moulton was dismissive of the new offer, announced Friday by a consortium headed by ex-Rover boss John Towers, saying it represented a "doomed strategy."

Trade and Industry Secretary Stephen Byers, meanwhile, was preparing to discuss the crisis at a meeting in the West Midlands.

"We think that there is a grave danger that a nonviable car company will be re-created, there will be a short term increased employment followed by approximately a nil employment," Alchemy's Moulton said. "We think the way we are going gives an opportunity for a growing, viable MG car company."

Last month, German auto giant BMW revealed its plan to unload the money-losing Rover to Alchemy. No price was ever announced, leading to speculation that BMW was either giving Rover away or was actually paying Alchemy to take the British automaks.

Alchemy, which has no car manufacturing experience, said that it planned to turn Rover's main Longbridge plant in central England into a niche producer of sports cars under the name MG Car Co. Alchemy hopes to post a profit within three years and sell the company within seven.

But unions feared the plan would lead to major job losses, and have now rallied behind Towers, a former Rover chief executive who left the company in 1996. Towers has offered few details, but he has hinted that his bid would keep Rover as a volume car producer, meaning fewer job losses.

BMW must now consider the consortium's offer against the Alchemy bid. BMW said it was leading parallel negotiations with both, but acknowledged that it still believes Alchemy will end up with the deal.

However, politicians from Birmingham, where the Longbridge plant is located, said the new bid would be better for the community.

"It is good news to hear the objective is to retain more significant volumes at Longbridge because that is going to be very important for jobs and livelihoods throughout the West Midlands," MP Richard Burden said.