The millionaires' consortium of Rolls-Royce owners and dealers, led by Michael Shrimpton, are working flat out in attempt to have a credible counter-offer on the table in time for a special meeting on Friday where Vickers shareholders - owners of the prestige car manufacturer - will decide the fate of the UK's most famous marque.
The meeting has been called to consider the relative merits of the two firm offers already on the table from the German car manufacturers BMW, which has bid pounds 340m, and Volkswagen, which has upped its initial offer to pounds 430m.
Mr Shrimpton claims to have firm commitments to top VW's offer plus the money needed to finance further development of the company over the next three to five years. He has also promised Vickers shareholders that they will not have to wait for their cash any longer than they would from one of the two firm offers already on the table.
But he admits that it will not be possible to have all the necessary documentation needed to persuade Wall Street banks to release the cash to support the offer.
The best he can hope for is an adjournment of the two meetings called to consider the rival offers. Vickers initially accepted the offer from BMW but switched its allegiance last month to Volkswagen after it made an increased bid. BMW, however, has the support of Rolls-Royce plc which parted company with the car company in 1971 but still retains control of the use of the Rolls-Royce brand name.
BMW has close technical agreements with Rolls-Royce plc and has offered to pay Rolls-Royce plc for the trade mark. However, it refused last week to increase its offer to Vickers. Volkswagen has promised to retain the existing British management of the motor company, to collaborate with Vickers in the development of a new all-British engine to replace the BMW engine which powers the newest Rolls models, and to invest up to pounds 2bn in the development of the marque over the next five years.
Its plans would involve quadrupling the current annual output of Rolls- Royce and Bentley cars and offer guarantees of increased employment in the UK.
The consortium's efforts have been dogged by delays caused initially by the refusal of the Vickers board to take the consortium seriously and release the vital details of the proposed sale. The consortium itself had problems finding a merchant bank able and willing to work on its behalf.
Mr Shrimpton believes he has an inside track because the consortium will be UK-based and does not need to buy the right to use the brand name, although it still needs consent for its proper use. The consortium has promised to match BMW's offer to put a director of Rolls-Royce plc on the board and is hoping to win the support of Rolls-Royce plc for a joint marketing campaign to develop the use of the Rolls-Royce brand name.
It also intends to develop a new all-British engine to power future models and to revive the Rolls-Royce Phantom models. It is prepared to offer Vickers an ongoing stake in the Rolls-Royce company.
But Volkswagen, with its vast financial resources, is still the City's favourite to win. Analysts are concerned that even if the consortium wins the race in the short-term, it may not have the resources to guarantee all the investment needed to maintain the long-term independence of the company.Reuse content