Malaysian firm Weststar is on the verge of agreeing a deal to buy British van maker LDV with the help of a government loan of up to five million pounds, a minister and LDV said Tuesday.
LDV, which employs 850 people, has not built any vans since before Christmas after its Russian owner GAZ decided to sell the business, and it was due to go into administration Wednesday.
LDV spokesman Guy Jones told Sky News television the deal had yet to be completed but said the government had offered a loan to keep it going until an agreement was reached.
Business minister Ian Pearson confirmed a deal was on the table. Government sources said the bridging loan was worth up to five million pounds (7.5 million dollars, 5.5 million euros).
"Weststar's proposed purchase of LDV offers the only credible chance of keeping this manufacturing plant in the UK," Pearson said.
"Whilst completion of the deal is not certain, it would have been irresponsible of the government not to support it going forward. But this is a one-off bridging loan and it cannot be extended."