Land Rover wins ruling against KPMG
Land Rover has won an High Court injunction forcing KPMG, receivers for UPF-Thompson, the collapsed chassis supplier, to maintain delivery of parts.
The injunction means UPF-Thompson, the sole supplier of chassis for Land Rover’s Discovery model must maintain deliveries despite mounting debts, the FT reported today.
Following the ruling, Bob Dover, chairman of Land Rover called for a shake-up of UK insolvency laws and said the government should adopt similar insolvency laws to America’s Chapter 11 – the bankruptcy protection used by Enron.
Dover said: ‘We’ve got to sort the law out on this. There is a place for receivership, but we cannot be expected to take on our suppliers’ liabilities.’
Chapter 11 allows US listed companies to file for bankruptcy protection, which allows management to restructure the business and negotiate with creditors.
Big Five firm KPMG was demanding £35m goodwill payment from Land Rover so UPF-Thompson could continue deliveries. KPMG argued that UPF could treat Land Rover, its dependent customer, as an asset.