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James asks DTI for £80m to secure MGR plans

Businessman David James is to ask the Government for an £80m lifeline guarantee to secure his plans to save MG Rover.

Under the plan, Shanghai Automotive Industry Corporation would have acquired Rover's Powertrain engine-making division, and bought the firm's remaining assets a year later.

For that to happen, James needed China's Shanghai Automotive (SAIC) to agree to buy key Rover businesses and assets, which it refused to do.

James now needs financial backing from the Government if he is to salvage his bid and is hoping to secure a meeting with leading heads of the Department of Trade and Industry.

“The plan was to use Rover assets as security to get the loan which would cover cash flow for the MG sports car in the first year,” says James.

He aims to sell off surplus Rover assets at the end of the year to cover the loan, with the security from the Government covering any shortfall.

The DTI confirmed that James had been in contact with them but said no meeting has been arranged.

James is also hoping to meet with SAIC boss Chen Hong – due to fly to the UK later this week - to discuss resurrecting possible joint plans.

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