John Hemming MP on MG Rover ahead of government report

Sep 11 2009 by Jonathan Walker, Birmingham Post

Today marks the end of a four-and-a-half year wait for a report into the collapse of MG Rover. The Birmingham Post has spoken to three people close to the Birmingham car giant about its collapse and the legacy it left.

MP John Hemming (Lib Dem Yardley) led what became the Phoenix bid to buy MG Rover – only to be forced out of the project at an early stage. He still believes Rover could have been saved if community representatives like him had been involved in running the firm.

Although I was a witness for the inquiry into Rover I am not one of the people who have had an early sight of the report. From my point of view, therefore, it remains quite an interesting issue to find out what it actually says.

I have had a number of detailed involvements with Rover since 2000 although I effectively got kicked out of the bid that I brought together in April 2000. Although I could have issued legal proceedings to deal with this at the time I decided not to as it would have almost certainly done irreparable damage to the business itself.

(See the MG Rover report here)

The announcement of Alchemy’s proposals to effectively close down Longbridge caused shockwaves across the region. Initially, few people thought anything could be done. Three key players, however, started working on alternate proposals. These were John Towers, myself and John Edwards. At the early stages John Towers told me it was not possible to put together an alternate bid as too much funding would be required. This had been considered previously but discounted.

What I discovered at an early stage was that BMW were willing to offer a massive dowry for Rover. This was the key thing that made it possible to put together a deal.

I then called together the key players who were all at that stage willing to work together. I asked Albert E Sharp to organise a meeting and this happened on Friday March 31 2000 in the evening. The people present were John Towers, John Edwards, Peter Beale, [lawyer] Andrew Sparrow, Mike Whitby, Dom King [from financiers Albert E Sharp], Brian Parker [who eventually became a non-executive director], Carl Chinn and others including union representatives.

The key to this meeting, which I chaired, was that it brought together the key stakeholders: unions, engineers, dealers and community, and at the same time funding had been identified (from BMW) that enabled a successful bid. This is the date upon which, according to Rover accounts, the Phoenix Consortium was formed. It is worth noting that it was the first date upon which John Towers had met John Edwards.

I find it very sad that the community angle was pushed out of the business. I still hold the view that the business could have been far more successful but the key to this was selling cars. Considerable damage was done to the brand by the financial manipulations such as the setting up of the Trust fund.