MG Rover’s administrators PricewaterhouseCoopers is this afternoon due to announce massive redundancies resulting from the collapse of the business.

This morning any chance of MG Rover being bought as a whole business by Chinese carmaker, Shanghai Automotive Industry Corp, were dashed after the company said it would not re-engage negotiations with a company in administration.

The message was delivered in a letter from the Chinese carmaker to the trade and industry secretary, Patricia Hewitt.

6,000 MG Rover workers face redundancy.

Ian Powell, joint administrator and partner in PricewaterhouseCoopers says: “The letter communicates to the Department for Trade and Industry that SAIC are not willing to acquire either the whole or part of the business on a going concern basis.

“In light of this development we have concluded that there is no realistic prospect of obtaining sufficient further finance to retain the workforce while the position with other parties is explored.

As we indicated earlier in the week significant redundancies will now be effected.” Steps are now being taken to formally notify employees who will be made redundant. The administrators have established an employee helpline and made arrangements with the Redundancy Payments Office in Birmingham to handle employee redundancy claims.

Tony Lomas, joint administrator and partner, PwC, added: “During the course of this week we have made every effort to establish SAIC’s intentions. We have had regular contact with SAIC’s advisers and had established direct contact with the company. SAIC has now stated its intentions and unfortunately does not wish to acquire the business.”

Yesterday a survey for the Birmingham Chambers of Commerce and Industry showed that Rover owes £9m to 25 of its suppliers, suggesting the total owed to the supply chain could run to tens of millions of pounds.

Suppliers are to meet tonight to discuss what they describe as ‘serious and immediate cashflow problems’.