MG Rover directors handed bans

‘Phoenix four’ disqualified from directorships after paying £42m in bonuses while running car firm into the ground Four former MG Rover directors, who paid themselves millions as they ran the car manufacturer into the ground, have been banned from acting as company directors for a combined total of 19 years. The so-called ” Phoenix four ” of Peter Beale, John Towers, Nick Stephenson and John Edwards acquired Britain’s last remaining volume car producer from BMW for a nominal £10 in 2000, with the enthusiastic backing of the then Labour government. They then spent the next five years pocketing huge awards before the company collapsed in 2005, owing £1.3bn to creditors and putting thousands of people out of work. Edward Davey, the business 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. The outcome of this case serves as an important reminder that unacceptable conduct by company directors can result in lengthy periods of disqualification.” From 17 May, Beale will not be able to work as a director for six years, Towers and Stephenson for five and Edwards for three. When MG Rover collapsed in April 2005 with the loss of 6,500 jobs, the Phoenix four and former MG Rover chief executive Kevin Howe had paid themselves a total of £42m . Howe has not been banned. The disqualifications follow a government report into the financial affairs of MG Rover and its associated companies that found that the conduct of the Phoenix four made them unfit to be company directors. It added that the directors manipulated the assets and income streams through the use of companies in which they, rather than the creditors of MG Rover had an interest, allowing them to benefit through large salaries, dividends and profits. The quartet described the report as a “witch-hunt” and a “whitewash” . Rover Automotive industry Simon Goodley guardian.co.uk

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