MG Rover administrators chasing another £56m
Ten years on from the collapse of MG Rover, administrators are chasing an extra £56 million that could mean extra payouts for thousands of former Longbridge workers.
PricewaterhouseCoopers, now known as PwC, was called in on April 8, 2005, as the company crashed with debts later estimated at £1.6 billion. 6,300 workers lost their jobs and hundreds of companies that supplies MG Rover were left out of pocket.
A decade later, PwC is still acting as administrator and chasing down claims to try and recover more money for unsecured creditors.
One relates to overpaid VAT of £56m dating back a number of years on vehicles manufactured by MG Rover and supplied to fleet operators. The matter is subject to litigation as there are competing claims as to who is entitled to the repayment. It is understood one of the competing claims is from BMW, which sold the car company to the Phoenix Consortium for £10 in 2000.
Since the collapse in 2005, which turned into a liquidation in March 2006, PwC has raised £165 million and processed and agreed more than 5,600 claims from unsecured creditors - including former employees and the Pension Protection Fund- worth £803m.
£80m has been returned to creditors- almost 10p in the pound. Some 4,000 claims from former employees in respect of their preferential claims have also been agreed and paid in full. It is understood former workers have received around £2 million since the collapse.
Rob Hunt, one of the original team of three PwC administrators, said today: "The MG Rover collapse was a significant event for a number of reasons – first and foremost for the many employees and families it impacted. MG Rover was part of the engine house of the Midlands economy and it was a major shock to witness its demise. The size and complexity of the job now sees us pass the 10-year milestone, but we have made significant headway in that time. We've returned almost 10p in the pound to creditors- double the 5p that was estimated at the start."
