Phoenix rises as BMW rules out Alchemy

German car firm BMW seem to have virtually ruled out a deal with Alchemy for the sale of loss-making British car maker Rover.

The car giant said that they did not believe that Alchemy, their first choice to take over Rover, were a serious contender any longer after talks broke down last week.

"I think we have stopped our negotiations last week and we came close to the conclusion that we won't continue that," a BMW spokesman said, "We want to start to get into negotiations with the Phoenix Group today."

Car unions are backing the Pheonix bid, which was launched by former Rover executive John Towers , because they beleive that a number of jobs at the firm's Longbridge plant can be saved.

Alchemy boss Jon Moulton said there had been fresh contacts between his team and the German car firm since Friday but BMW seemed adamant that Alchemy had blown its chance.

BMW has warned that unless a deal can be reached within a month it will close Rover, leading to the loss of thousands of jobs, particularly in the West Midlands, where the huge Longbridge factory is a major employer.

The Phoenix consortium has spent the last few days examining documents supplied by BMW which gives financial and sales information.