‘Imploding’ van maker seeks urgent gov help

Posted on 23 Feb 2009 by The Manufacturer

Van manufacturer LDV is asking for £25 million in bridging loans from the government to tide it over until a management buy-out deal goes through.

The firm say the money necessary for its survival and will safeguard its 900 Birmingham-based employees. Reportedly on the brink of implosion, without the money analysts have suggested the firm has “a matter of days” to survive.

The company is owned by the Russian Oleg Deripaska through the GAZ group, the oligarch at the centre of a row that broke out last year when George Osborne, shadow chancellor, was accused of attempting to secure a donation from Deripaska, one of the world’s richest men, during a stay on the Russian’s yacht.

On the proposed management buy-out, LDV chairman Erik Eberhardson said: “We are almost ready to go, but we need the government to do its bit.

“I am confident they understand the potential to secure this exciting green technology in Britain – and the need to move very quickly.”

Peter Mandelson, who had also been involved in the yacht affair, has, as business secretary, now to decide whether the firm gets the money.

A spokesperson from the Department for Business Enterprise and Regulatory Reform (BERR), said: “We have been in close discussions with all the automotive sector including with LDV. We have provided considerable support to LDV in recent years and continue to offer them help, including assistance with their application for funding from the European Investment Bank.”