Ailing LDV finds a backer in Sun Capital

Ailing LDV finds a backer in Sun Capital

	Published : Sat, 17 Dec 2005 12:05 By : Andrew Stead Print this Story

LONDON: Ailing British van maker LDV Ltd is getting a new lease of life. Sun European Partners, LLP., the European adviser to U.S. private equity firm Sun Capital Partners Inc., has agreed to a refinancing package to rescue the company from a near collapse and thereby save 1,000 jobs.

The package will be offered through an affiliate of the equity firm. It will ensure a majority stake for Sun European Partners in the Birmingham-based LDV, one of the few surviving British vehicle makers. The exact amount of funding has not been disclosed.

LDV, popular for its Sherpa van, had earlier this year come out with its latest Maxus range of light commercial vehicles. But a severe cash crunch forced the company to suspend production and lay off workers last week. The company pins lot of hopes on Maxus in its plans to return to productivity.

LDV's chief executive Allan Amey said the deal will help the company to leverage the Sun affiliate's resources to pursue a sustainable long-term growth strategy.

The company said it will restart the suspended production early next week. Its focus will now be Maxus and it will stop manufacturing older models like Convoy and Pilot. Maxus had won the "2005 Van of the Year" award.

LDV, which came into being following a management buyout of the vans unit of the now defunct Leyland DAF in 1993, makes more than 13,000 vehicles a year with a revenue of around 200 million pounds. Private equity firm 3i, Barclays Bank and Lloyds TSB had together invested more that 500 million pounds in the company recently.

The Transport and General Workers' Union welcomed the deal. General secretary Tony Woodley said LDV is a good, modern plant managed by good people with a good product and a good workforce. They deserve the future that has hopefully been secured.

Sun European Partners' managing director Phil Dougall said the firm is happy to have LDV as one of its affiliated portfolio companies. "We look forward to accelerating its growth strategy through the roll out of the Maxus range and the development of derivative product lines."

Sun Capital and its affiliates have invested in more than 100 companies all over the world. These companies have a combined sales of more than $22 billion.