Volvo confirms talks with Leyland DAF

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The Independent Online
VOLVO of Sweden yesterday confirmed that it had held talks with the administrative receivers of Leyland DAF at Arthur Andersen. However, a Volvo spokesman said that the talks concerned general developments in the industry.

It is believed that the discussions were at an early stage and the receivers have also been in contact with Paccar, a US truck maker. However, management at the Leyland plant, lead by John Gilchrist, the managing director, is hoping it will be able to stage a buyout of the truck operation. Talks have been held between the receivers and the management team, who say that they have received offers of funding.

Negotiations are also due to be concluded this weekend for the buyout of the company's van operation at Birmingham. The buyout team, led by Alan Amey, plans to close the plant briefly on Monday morning for a celebration with the staff and to announce details of the deal.

Although 3i is leading the syndicate supporting the van buyout, the team has declined to say who else is involved. Earlier this month, the Birmingham Heartlands Development Corporation said it would buy 41 acres of surplus land on the site for about pounds 4m once the buyout is complete.

The buyout team has also applied successfully to the Department of Trade and Industry for an undisclosed amount of regional selective assistance. Workers at the van plant have agreed to pay cuts of up to 8 per cent. It is thought that reductions in the pay bill were demanded by banks before they would back the buyout.

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