Govt loan brings new hope for LDV

06-05-2009

Govt loan brings new hope for LDV
The future of British van-maker LDV is looking more assured after a government bridging loan staved off the threat of administration for a week.

The one-off loan, thought to be about £5 million, is aimed at helping Malaysian firm Weststar to buy LDV.

LDV and the 800 or so workers it employs at its plant in Birmingham have been in dire straits since Russian owner GAZ said it wanted to sell the business last year.

But as hundreds of workers faced up to the fact their jobs would go when the firm entered administration, the government stepped in with a "short-term bridging loan" to support the purchase of LDV by Weststar.

"Weststar's proposed purchase of LDV offers the only credible chance of keeping this manufacturing plant in the UK," said business minister Ian Pearson.

"Whilst completion of the deal is not certain, it would have been irresponsible of the government not to support it going forward.

"But this is a one-off bridging loan and it cannot be extended."

A statement on the finalised deal for LDV is expected to be laid before parliament later today.

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