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BMW Promises To Help Avoid Layoffs

March 23, 2000

MUNICH, Germany (AP) _ BMW is offering to work with British officials to avoid massive layoffs as it sheds its money-losing Rover division, but did not commit to direct financial aid for the restructuring.

British Trade and Industry Secretary Stephen Byers, who flew to Munich to meet with BMW chairman Joachim Milberg, described the talks Thursday as ``very positive and constructive.″

BMW said it would work with the British government in a task force to find alternatives for British workers who stand to lose their jobs as a result of the purchase by Alchemy Partners Ltd., a British investment group, of the MG and Rover auto units. Alchemy will also be part of the working group.

BMW spokesman Axel Obermueller denied rumors that BMW might still sell Rover to another carmaker, saying the company was in ``exclusive talks″ with Alchemy and expected the deal to be completed by midyear.

``We aren’t trying to find anyone else,″ he said, while adding that Alchemy was free to decide whether it would turn around and sell Rover to a third party.

Byers said the British government would provide $190 million in immediate aid to the region near Birmingham where Rover has its main plant, employing about 8,000 people.

Obermueller called reports highly exaggerated that up to 50,000 jobs _ including suppliers to the Longbridge plant _ are in danger, saying that the number would probably be 5,000 to 10,000 jobs if conditions don’t improve.

BMW announced last week that Alchemy would take over the MG and Rover divisions. BMW also is selling the profitable Land Rover division to Ford Motor Co. for $2.91 billion, but is keeping the unit that will produce a new version of the popular Mini car.

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