By Ambrose Evans-Pritchard (Filed: 06/05/2005)

Iran is preparing an offer to buy MG Rover’s entire operating plant and reopen the Longbridge assembly lines for immediate production.

The bid to save up to 20,000 jobs in the West Midlands is seen an effort to earn goodwill in Britain and soften the Government’s hard line on Iran’s nuclear programme.

  
The deal could save 20,000 jobs
Teheran has ordered rival Iranian car firms Dastaan, Saipa, and Khodro to work together towards a combined offer to buy about 150,000 Rover cars over the next two years before moving to partial assembly of kits in Iran, which would safeguard thousands of jobs in Britain until the end of the decade.

A team from Iran’s industry ministry visited Longbridge last week on a fact-finding mission to inspect the plant. Dastaan is acting as the negotiating arm in Britain.

Rover’s administrator, Price Waterhouse Coopers, has received 16 separate offers from nine countries, but most buyers aim to strip Rover’s assets and exploit the technology. PWC has so far refused to show its hand.

Dastaan’s British agent, Peter Linghorn, said Iran is the only buyer willing to preserve the Rover structure. “We’re willing to take over the whole thing and kick-start production,” he said.

He added that Iran was even willing to take over some of the Rover MG’s £67m pension liabilities: “They want to help. This is not a commercially-driven deal, it’s about enhancing relationships.”

An Iranian official said yesterday that it was unclear exactly what was for sale. “This isn’t about money. The ministry has the resources, but we still don’t know what assets we can buy once the Chinese have finished with Rover,” he said.

Mr Linghorn said the deal would save “almost 100pc” of the existing MG Rover structure. “We want to reopen all the Rover lines: the 75, the 45 and 25, MG sports,” he said. “There’s an immediate need for 150,000 cars because the country is only just starting to open up to imports,” he said.

He believed MG sports cars could still be exported to Europe and America. Later phases would involve assembly of a further 150,000 cars a year in Iran.

While Iran is not demanding an explicit “quid pro quo” for saving British jobs, it hopes Britain will play a “constructive” role in the ongoing crisis talks over Iran’s nuclear programme.

Last Friday, Iran threatened to restart uranium enrichment, seen as a step towards the production of nuclear weapons. Teheran insists that the fuel is for civilian reactors.

Washington and the EU have demanded an immediate halt to the nuclear fuel cycle.

The Foreign Office said yesterday that there was “no question” of Britain linking the issues of Rover and uranium enrichment.