Rent deal to salvage Rover sale hopes

MG ROVER'S administrators are expected to pay a part of the rent due today on the Longbridge car factory to enable them to progress with the sale of all or parts of the business.

Hopes are growing that some of the 403-acre site will be saved for carmaking with at least one bid for the MG sports car business, from a group led by Fraser Welford-Winten, former head of Rover's engines arm, with US investor backing.

The group wants to produce 30,000 MGs and Austin Healeys - a sports car last made in the 1960s - by its third year, using two existing Longbridge plants. Plans include a revamped MG Midget selling for £14,000. Austin Healeys may be priced at between £30,000 and £60,000.

Birmingham businessman Martyn Moseley is thought to be pursuing the whole of MG Rover, as are consortiums led by Chinese carmakers Nanjing Auto and China Geely.

Developer St Modwen Properties bought the Longbridge site in two deals in 2003 and 2004 for £57.5m, agreeing to lease it back to MG Rover for 35 years at an annual rent of £5m.

The next quarterly rent payment is due by tonight but administrators PricewaterhouseCoopers have legal powers to force St Modwen to accept a series of smaller payments spread over the quarter.

The land is a huge redevelopment opportunity, potentially worth hundreds of millions of pounds.