John Towers and the Phoenix 4 reply to the open letter regards them receiving a further £6million MG Rover payout
August 16, 2015
In October of last year, regular visitors to the site will recall that an open letter was sent to John Towers and the Phoenix directors. This followed claims that the Phoenix 4 were set to receive another substantial payout following the closure of MG Rover, this time in the region of £6million.
For those not so familiar with the story, I'll try to summarise as briefly as I can. In 2000, BMW sold MG Rover to the Phoenix 4 for £10 and as part of the sale provided a £450 million dowry in order to secure the running of the company for approximately 5 years. During these 5 years, the Phoenix 4 remunerated themselves a staggering £42milllion. In April 2005, MG Rover was taken over by the administrators and 6,500 people were laid off receiving no company redundancy pay.
At the time amid much press questioning and a looming Government enquiry into their affairs, John Towers announced via a BBC interview that he would create a Trust Fund for the workers to replace this lack of company redundancy and hoped up to £50 million would be made available.
In August 2012 following the winding up of MG Rover assets, John Towers announced that there was no money available for the trust and he and his fellow directors would not be making any contributions either.
However, in 2014 it came to light that MG Rover Capital, another organisation of the Phoenix directors had £23million on its books and the directors were inline for a further £6million payout. In his earlier correspondence to the Justice for Rover Workers website, Mr Towers had stated that he thought there would be nothing available from this venture and therefore this could be seen as fresh money. With this in mind, I wrote the open letter asking if this money could be made available for the ex-workers trust fund.
Since October I have been in constant dialogue with representatives of the directors (they refuse to deal with me directly). I have constantly been told the letter were something they were looking into and was provided with a number of excuses as to why the letter hadn't yet been replied to. These excuses were also then explained as waiting for full legal advice and that they would be meeting to make a decision. Finally, on Friday, the following response was provided:
After much deliberation, the response from John Towers, supported by the other former directors is:
"As indicated in a previous response, we have nothing more to say on this matter.''
I'm sorry it has taken so long to arrive at such a brief response, but your letter was considered very seriously and a great deal of advice taken before the decision to respond in this way was taken.
It seems that this time, it could well be the end of the road with regards getting money from the Phoenix Directors into the fund. I will at this time take a few days to debate what to do next.