Buyout hopes collapse for van maker

A planned management buyout for the Birmingham-based vanmaker LDV has fallen through.

The scheme was "no longer an option", it was reported today. But there is some hope: there is interest in the firm from two overseas companies.

LDV, which employs about 850 workers directly, has produced no new vehicles this year and thousands of supply jobs are also in peril. The firm has been seeking a Government loan to resume production and develop a "green" vehicle. Figures reported for the loan request range up to £40million, but it has been rejected.

The vanmaker is owned by Russian firm Gaz. Its officials are reported to have met officials from the Government's Business Department, which reported news about the end of the buyout scheme and the overseas interest.

A Business Department spokesman said: "We understand that the management buyout is no longer an option. It has not been approved by parent company, Gaz.

"LDV has also now told us it has been approached by two potential investors. They are overseas companies. We are contacting these two potential investors today to find out more information about their level of interest in LDV. We are still seeking clarification on points raised in our recent letter to LDV.

"The Government has already invested £25 million in this plant, has rescheduled tax payments and has got agreement for their rent to be reduced."