MG Rover has bought Rover Financial Services for €544 million to regain access to 58,000 Rover drivers and take a more direct role in managing residual values.

The purchase puts the firm back in control of historic retail finance contracts for Rover, MG and Mini vehicles leased under BMW's ownership. A new company, MGR Capital, has been formed to handle the purchase, funded by Phoenix Consortium and banking giant HBOS.

MGR Capital will manage the financing arrangements relating to the portfolio, and with MG Rover Group, the eventual disposal of vehicles at the end of their finance leases.

The move will not affect a recent deal with First National, which provides the backing for all new finance deals written through MG Rover dealerships. (December 2001)