Mandy says he was duty bound to call in the cops after reading the results of the recently-completed, £15.9m (yes, really) in-depth inquiry into the affair, commissioned shortly after the firm went into administration in April 2005.
That must be quite an explosive and thorough document – particularly as it was only supposed to take 18 months to produce. So presumably the good Lord Mandelson will be eager to share its pungent contents with the rest of us? Well, er, not exactly. We are sure he would love to really, but now a Police investigation is underway his hands are tied. Publication will have to be shelved indefinitely pending any possibility of a trial. It’s a blow but there you are.
There’s no doubt that the MG Rover saga remains an exceptionally unedifying tale of corporate woe and alleged asset stripping. Although the firm was struggling when acquired from BMW by the so-called Phoenix Four in 2000 for the nominal sum of £10, it came with a handy £500m dowry from its former parent. And yet only four years later it was posting losses of £77m and had run up a workers pension scheme deficit of £470m. When its Longbridge factory closed in 2005, with it went the Rover name, an historic brand which – initially as a bicycle maker – dated back to 1885.
The Phoenix Four themselves – John Towers, Nick Stephenson, John Edwards and Peter Beale (no, not the one who used to be on East Enders) – seemed to do rather better out of the whole mess than their 6,000 suddenly ex-employees, however. They took £42m in pay and pensions out of the firm before it went down, and at one stage took a £10m loan note on the company to compensate them for the risk of putting £60,000 each of their own cash into the business. That’s quite some risk/reward ratio, we think you will agree.
So the story is unlikely to figure on many business school curricula, except perhaps as an example of how not to execute a turnaround. But fraudulent? That’s going to be very much harder to establish, especially now so much time has passed. And there has already been one investigation into the affair, undertaken by the firm’s administrator, PwC - it found no evidence of fraud.
The Four have reacted strongly to the news, stating, ‘There has never been any suggestion of improper conduct by the directors and this was confirmed in a report by the administrators six months after they took over the running of the company.’
So what’s really going on? It couldn’t possibly have anything to do with the fact that this new report might just have a few choice words to say on the subject of the Government’s behaviour in the whole debacle, could it? And that the only way to delay the publication of its potentially damaging findings is to place it sub-judice by ordering a Police investigation?
You might think that, but we couldn’t possibly comment…
In today's bulletin:
Watchdog sparks row over public sector pay
Mandy puts SFO in MG Rover collapse driving seat
Ashley loan row overshadows JJB fundraising plans
UK trumps US in customer satisfaction stakes
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