Weststar a Malaysian vehicle importer is in talks with Russian owners Gaz for a deal to save LDV the Birmingham based van manufacturer. The future of the van-maker was looking bleak after its directors made an application to put the company into administration only a few days ago.
A court hearing for administration which was supposed to be held at Birmingham County Court on Wednesday May 6th was put on hold by the Judge for a week to allow time for the deal to be completed. The UK Government has also stepped in to offer a one off £5m short term bridging loan to ensure that LDV keeps afloat whilst the deal goes ahead.
The LDV Washwood Heath plant laid off most of its 850 workers last weeks as the last of the money ran out. Production at the plant was put on hold in December of 2008, since then only limited number of vans has been produced at the plant. Although Weststar has not yet stated that it will keep its production in the UK, this latest deal seems to be the last hope for both the plant and its workers.
“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,” he said.
Weststar is no stranger to LDV having already been in partnership since 2007 for the marketing and assembly of LDV’s Maxus throughout Asia and the Middle East. If the deal does go ahead it will provide the Malaysian owned Weststar with an established International brand and direct access to the European Commercial Vehicle market.