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BMW Agrees to Sell Struggling Rover Unit

May 10, 2000|Associated Press

Germany's BMW agreed to sell the ailing Rover car group to a British consortium that mounted a dramatic, come-from-behind effort to take over the business and save thousands of jobs. The Phoenix consortium, headed by former Rover Chief Executive John Towers, said contracts had been signed in London after several days of negotiations. BMW said the "symbolic purchase price" was $16. However, BMW spokesman Hubert Bergmann added that the German car maker has agreed to lend Phoenix $765 million to help the consortium get Rover off the ground. BMW has been eager to rid itself of Rover after failing for six years to stem the group's losses. Phoenix said it would take over responsibility to develop, produce and distribute Rover cars, which are not sold in the U.S. The consortium said it would continue building the Rover 25 and 45 models and MG sports cars at the Longbridge plant in Birmingham, Britain's largest vehicle plant, employing 8,500.

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