Stricken van maker LDV has finally been given the £5 million it has been asking government for to enable a proposed takeover by a Malaysian company to take place.
The bridging loan was awarded last night after government had repeatedly turned to requests for it since late February. Government said it was swayed to provide the money because vehicle importer Weststar will keep manufacture in the UK if it buys the firm.
Birmingham-based LDV is owned by the Russian GAZ Group, fronted by oligarch Oleg Deripaska, and employs 850 people. Its parent firm has run into problems in its home market and decided to cut all funding for the van maker.
The prospects were thus looking grim for LDV, which hasn’t made a van since December last year, before the bridging loan was awarded. A planned management buyout was thwarted because the money was not secured.
The Malaysian Weststar is now set to buy the flailing firm having agreed a deal yesterday based on the bridging loan coming in.
Ian Pearson, Business minister, said: “Weststar’s proposed purchase of LDV offers the only credible chance of keeping this manufacturing plant in the UK,” said Ian Pearson, Business minister. “Whilst completion of the deal is not certain, it would have been irresponsible of the Government not to support it going forward.”
Pearson went on to warn that the loan was a one-off and that it will not be extended.
Union officials described getting the bridging loan as “like pulling teeth”.