Consortium given a week to get funding for Rover buy-out

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The Independent Online

BMW has given the Phoenix consortium a week to come up with a deal to rescue Rover and safeguard the future of its Longbridge car plant and upto 50,000 jobs in the West Midlands.

The German car maker is expected to wait until after the local elections are over tomorrow to decide whether the consortium, led by the former Rover chief executive John Towers, has sufficient financial backing to strike a deal.

If Phoenix can satisfy BMW, then negotiations will continue until the end of this month. If not then BMW is expected to start preparations for the liquidation of Rover.

Mr Towers, accompanied by financial and legal advisers, met BMW yesterday for his first face to face talks. Afterwards he described the discussions as "very detailed and positive".

However, unions last night cast doubts on the ability of Phoenix to rescue Rover and called on Mr Towers to declare the names of his financial backers. "It is important not to raise false hopes for the workers," said a union source.

Phoenix, which is backed by the automotive group Mayflower and West Midlands businessmen, is looking for a £500m cash injection from BMW in addition to £200m it claims it can raise from financial institutions to keep Longbridge alive. The consortium says its proposals will maintain production of up to 250,000 cars at the plant.