BMW's brand role in Rover's China deal

GERMAN carmaker BMW, former owner of MG Rover, has found itself linked to the frantic efforts to save the ailing group - because it still owns the Rover name.

A spokesman for Munich-based group confirmed that the Rover brand is licensed to Phoenix Venture Holdings, the British group that bought the Midlands outfit from BMW for £10 in 2000.

BMW now appears to back efforts to keep MG Rover alive through a deal with China's Shanghai Automotive Industry Corporation (SAIC), saying its ownership of the Rover label should not be a sticking point. 'We wouldn't wreck any deal,' a spokesman for BMW said.

Use of the roster of brands associated with MG Rover is of great importance for the Chinese side. State-owned SAIC is interested in cash-strapped MG Rover both for its design expertise and for access to its famous names. Should its approach to MG Rover falter it is almost certain the British firm would collapse.

{1}BMW bought MG Rover from British Aerospace in 1994, but was unable to turn it around. The unit was often referred in the Press as 'the English patient'.

Efforts to secure a deal with SAIC have reached a critical point. As talks continue in Shanghai between SAIC, Phoenix boss John Towers and UK officials, attention has switched to whether the Government will advance a bridging loan to shore up MG Rover's balance sheet.