Vickers Plc Says It Is Heading Towards Rolls-Royce Auction

British defence and engineering company Vickers Plc said on Monday it still intended to auction off its luxury car unit Rolls-Royce Cars despite the threat of a hostile takeover attempt for the whole group. There is no bid on the table.but a competitive auction is developing, a company spokesman told Reuters.

He said Vickers, which plans to focus more on its defence and propulsion technology business, was still receiving queries on Rolls-Royce despite hints by car parts maker Mayflower Corp Plc that it could bid for all of Vickers.

Industry sources confirmed on Monday that Ford Motor Company of the United States had joined the fray while German auto firms BMW and Daimler Benz were still interested in the luxury car unit. (Reuters)

 

Industry sources reiterated that the auction price could range between 350 and 600 million pounds ($1 billion).

The Vickers spokesman said the group was still aiming to complete the auction by February or March.

BMW, one of the strong favourites to buy Rolls-Royce Motors, was forced to scotch weekend reports that it would support a bid by Mayflower, to prevent the car unit from falling into any rivals hands.

In a newspaper interview published on Monday, BMW chairman Bernd Pichetsrieder said: We have nothing to do with this Mayflower bid. It is embarrassing for us that somebody gives the impression that he has our support. We have no interest to support that at all.

Pichetsrieder also denied reports that BMW could directly bid for Vickers.

An industry source said BMW was actually trying to see if it would benefit from a successful Mayflower bid.

They (BMW) are certainly keeping their options open, he said. The German car company enjoys a close relationship with Mayflower through its UK unit Rover which is one of Mayflowers major customers.

A Mayflower source said the company was still examining its options on Vickers.

Industry analysts expect Mayflower to make an almost 1 billion pound bid for Vickers, sell its defence arm and retain Rolls-Royce cars, Cosworth engine and propulsion technology divisions.

Mayflowers share price was down two pence to 175p, while Vickers gained 9/12 pence to 257p at 1100 GMT.

Vickers also announced on Monday it had signed a contract with Oman to supply 20 Challenger 2 main battle tanks valued at over 100 million pounds.