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Phoenix Four disqualified
The four former directors of MG Rover who oversaw the collapse of the last British volume car manufacturer have been disqualified from managing companies.
The disqualification of the ‘Phoenix Four’ is for varying periods of up to six years, and has been imposed because The Insolvency Service deem them “unfit to be company directors”.
Particular criticism was reserved for the way the directors manipulated the assets and income streams of MG Rover through the use of companies in which they personally had an interest, rather than the creditors of MG Rover.
This meant they received large salaries, dividends and profits.
Peter Beale has been disqualified for the longest term, six years. John Towers and Nick Stephenson have been disqualified for five years, with John Edwards receiving a three-year disqualification.
The disqualifications are, however, voluntary: all four say they are not guilty of any wrongdoing.
Edward Davey, Minister with responsibility for corporate governance and company law, said: “These disqualification undertakings represent a successful conclusion to a lengthy and complex investigation into the collapse of MG Rover.
“Peter Beale, John Towers, Nick Stephenson and John Edwards have each been banned from being involved in the management of any company for several years.
“The outcome of this case serves as an important reminder that unacceptable conduct by company directors can result in lengthy periods of disqualification.”
The collapse of MG Rover in April 2005 saw creditors owed nearly £1.3 billion. Because of this, the Secretary of State ordered an investigation into MG Rover, Phoenix Venture Holdings and MGR Capital Limited.
It was after the publication of this report that The Insolvency Service begun proceedings and the subsequent disqualifications, which the Secretary of State approved in April: they come into effect on Tuesday 17 May.
More encouragingly, production restarted at Longbridge last month, as the first MG6 rolled off the assembly line. It is hoped this car can revive the MG brand in the UK, supported by the might of China’s largest car company, SAIC.
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