Britain seeks to bar directors after MG Rover collapse

LONDON – Britain said on Friday it would seek to ban the directors of MG Rover from running companies, after a highly critical report into the carmaker’s 2005 collapse with the loss of 6 000 jobs.

Business Secretary Peter Mandelson said he wanted the four men declared ‘unfit to hold office’, following publication of the results of a four-year probe into the demise of the firm, which produced the iconic Mini.But the directors, who bought the firm from German carmaker BMW in May 2000 for a token 10 pounds, rejected the investigation as a a ‘witchunt’ and a ‘whitewash’ that absolved government ministers of any blame.The report found the four directors of MG Rover, known as the Phoenix Consortium, paid themselves about nine million pounds (US$15 million) each over the five years they owned the firm.When the carmaker based at Longbridge in Birmingham went into administration in April 2005, it owed creditors nearly 1,3 billion pounds.’During the five-year period, the members of the Phoenix Consortium and Mr. Howe obtained large, and we say unreasonably large, financial rewards, totalling tens of millions of pounds,’ the report said.Mandelson said the investigation, which cost 16 million pounds, had been ‘painstaking’ and the government would respond with action.’It was important to get all the facts into the open so that workers who lost their jobs and creditors who were not paid know the truth,’ he said.’Action is being taken. Based on this report, work has been commissioned to start legal proceedings to seek to declare relevant directors unfit to hold office and to disqualify them from management of any company in future.’The report also claimed one of the directors gave ‘inaccurate and misleading information’ to lawmakers investigating what happened at MG Rover.At the same time, it found evidence of questionable briefings by government officials to the press about the situation.The four directors, Peter Beale, John Edwards, Nick Stephenson and John Towers, rejected the conclusions, saying they ‘tried our best’ to save the company but the government should take responsibility for its failure. – Nampa-AFP