The struggling UK van maker, the , Birmingham-based LDV has been put back into administration after Malaysian vehicle importer Weststar Group failed to raise the necessary finance to buy the stricken van maker.

The administrators PriceWaterhouseCoopers (PwC) said yesterday that they would sadly have to lay off the vast majority of the 850 LDV workers since there are no funds to keep the employees on.

The Weststar Group rescued LDV, owned by Russian billionaire Oleg Deripaska's GAZ Group, from going into administration last month, after the UK's Department of Business Enterprise & Regulatory Reform gave it a one-month £5-million bridge loan until it was able to raise the finance from the market to acquire LDV. (See: LDV rescued in a last minute deal by Malaysian Weststar Group)

Although Weststar had asked the UK government for a £45-million bridge loan, the government refused to give additional funds since it had already provided £24 million to LDV at the time GAZ acquired it in 2006.

LDV applied at the county court for administrators to be appointed again yesterday even as managers made a final £60 million loan appeal to the government on Friday saying that around 850 jobs at LDV and another 3,200 jobs at suppliers' and distribution network were at risk.

LDV, which has not built any vans since December last due to a drastic slump in sales and paid about £1 million as part of its employee's insurance contribution., told the UK government that by closing its factory, the UK Treasury would stand to lose approximately £53 million in unemployment benefits and lost taxes in the first year.

It added that the UK economy would lose an additional £200 million in wages, purchases and export revenue.

Workers at LDV fear that administrators would be forced to liquidate the van maker's assets and potential overseas buyers could take the machinery abroad, thus closing the plant permanently at the Washwood Heath site.

Surprisingly, Weststar is now among three other buyers talking to the administrators in buying LDV's assets.

Weststar had formed an alliance with LDV in 2007 to market, assemble, distribute and service the full range of LDV Maxus light commercial vehicles in the 20 countries in Asia and the Middle East, including Vietnam, Indonesia, Australia, and New Zealand.

LDV was formed in 1987 through the merger of the Leyland Trucks division, including the Freight Rover van making interests, of the British Rover Group with the Dutch DAF Trucks company.

In 1993, DAF NV became insolvent and Leyland DAF went into receivership, and was spun-off into four distinct companies through management buyouts, with LDV Limited being formed as a van manufacturer based in Birmingham in 1993.

It later changed its name to LDV Group, and is the only van maker in the UK. It is a specialist manufacturer of the multi-award-winning range of Maxus light commercial vehicles and had plans to bring out electric cars in the near future.

LDV was acquired by Russia's second largest car manufacturer Gaz from an affiliate of Sun European Partners in 2006, but due to declining vehicle sales in the UK and overseas, Gaz said that it could no longer support LDV financially as Gaz had also been suffering from low vehicle sales in Russia and was restructuring part of its debt.

GAZ said in a statement, "Over the last few months, we have fought relentlessly to find a solution that would ensure jobs and manufacturing remain in Birmingham and we have done everything we can to secure LDV's future in Birmingham but, unfortunately, time has run out."

One of LDV's main customers was the UK's postal service, The Royal Mail.