Business

Phoenix Four agree not to serve as company directors

The MG Rover car factory sign is pictured in Longbridge, Birmingham
Image caption MG Rover collapsed in 2005 with debts of £1.3bn and the loss of 6,000 jobs

The directors who ran the MG Rover group when it collapsed have been disqualified as directors.

Peter Beale, Nick Stephenson, John Edwards and John Towers - known as the Phoenix Four - have voluntarily agreed a ban for between three and six years.

The disqualifications by the Department of Business, Innovation and Skills, follow a "lengthy and complex investigation" into MG's collapse.

The men said they do not accept any allegations of wrong-doing.

The directors of Phoenix Venture Holdings Ltd bought MG Rover, in Birmingham, for £10 in 2000 and paid themselves £40m in pay and pensions.

'Voluntary compromise'

MG Rover collapsed in 2005 with debts of £1.3bn and with the loss of 6,000 jobs.

Its then directors were widely accused of enriching themselves whilst mismanaging the company. This view was supported in an independent report in 2009.

The former directors of Phoenix Venture Holdings (PVH) and MG Rover Group have now agreed not to hold any company directorships for up to six years.

A spokesman for the consortium said the former directors, who have never faced criminal charges, had done nothing wrong.

He said they had voluntarily agreed to the ban: "As they have already made it clear that they have no intention of holding company office in the UK, they have agreed to a voluntary compromise, while emphatically not accepting any allegations or suggestions of wrong-doing.

"The former directors point out that they have done nothing which justifies disqualification. All of the many inquiries into the collapse of MG Rover have achieved little other than a series of massive bills."

In March this year the four resigned as directors of PVH and its associated companies.

But the area's local MP believes the decision to disqualify the four directors would be of little consolation to MG's former workers.

"It doesn't change anything. It won't bring back the jobs of the 6,000 people who lost them when MG Rover collapsed," said Richard Burden, Labour MP for Northfield.

"One thing they could do that would make a difference, though, would be to make good on the promise they made to put money into the trust fund set up for former employees.

"They could put some of their personal fortunes into the trust. That way it would help former employees to have closure and move forward in their lives."

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