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The inquiry was set up by the Secretary of State for Trade and Industry after MGRG (MG Rover Group Limited), the manufacturer of Rover and MG cars, went into administration on April 8, 2005 owing creditors nearly £1.3 billion.
Gervase MacGregor FCA and Guy Newey QC were appointed as inspectors under section 432 of the Companies Act 1985 and instructed to investigate the affairs of MGRG, its parent company Phoenix Venture Holdings (PVH) and MGR Capital Limited between the purchase of MGRG from BMW in May 2000 and the date of it entering administration.
The inspectors investigated the actions of the directors of PVH throughout their 5 year ownership - particularly Peter Beale, John Edwards, Nick Stephenson and John Towers, known as the Phoenix Consortium.
They also investigated restructuring changes within the Group which led to the creation of 33 separate companies throughout that period; the scale of financial rewards made to the directors and the events which led to administration itself. This included the role of Government to secure bridge finance while take-over discussions took place with Chinese car manufacturers Shanghai Automotive (SAIC).
The inquiry studies the role played by professional advisors including auditors and corporate finance advisers Deloitte and lawyers Eversheds; aspects of corporate governance; and financial statements and audit arrangements including the transfer of assets.
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