By Andrew Cornelius, Industrial Editor
British Aerospace could make more than £80 million, four times what was originally expected, from redeveloping Rover Group’s Cowley works, in Oxford. Discussions have begun with Oxford city council on how BAe can develop up to 87 acres of surplus land at the Cowley works when the site is reorganised in 1992, against the 46 acres anticipated when Rover was sold.
A Rover spokesman said yesterday that the company was involved in exploratory talks with the council over how the land could be developed. At the time of the sale the National Audit Office valued the 46-acre Cowley South works at £20 million. A subsequent announcement confirmed that the works, where the Montego and Maestro models are built, were to close in 1992 . There was no indication until late last month that BAe also planned to close the north works at Cowley to release a further 41 acres of land, and double the potential value of the land to be redeveloped. Even these estimates could be conservative, according to the City analysts, Warburg, which estimates that the Cowley South works alone could be worth £40 million, putting an £80 million price tag on the entire site. The decision to release more land came as part of a £130 million reorganisation at Cowley which will involve building new final assembly facilities beside the sub-assembly and car body plant located on a third site at Cowley. This will achieve Rover’s aim of turning Cowley into a new streamlined centre for producing executive and sports coupe cars.
BAe, which took control of the property developer Airington Securities to help exploit its land assets, has been forced to reconsider its plans to redevelop the site of the former tractor factory at Bathgate, near Glasgow, as a shopping centre. Rover Group joined Clayform Properties to put together a proposal to develop the Bathgate site, valued by the NAO at £5 million. The planning application has been turned down by the Scottish secretary.
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