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SAIC set to acquire global automotive consultancy Ricardo 2010.

Shanghai Automotive Industry Corporation, the Chinese group with rights to the Rover 45 and 75, is expected to take over a West Midlands-based technological joint venture operation.

Ricardo, the global automotive consultancy which runs the joint venture at its drive-train site at Leamington Spa, said yesterday that SAIC is expected to exercise an option to acquire the operation, called Ricardo 2010, before June 2007 for a nominal pounds 1.

The research and development centre was set up as a wholly-owned Ricardo subsidiary employing about 150 mainly ex-MG Rover engineers in May 2005 to work on new cars for SAIC.

They are working mainly on a development of the 45, which essentially will be a new car designed and built to European standards. There are no indications yet where or when the new car will be launched or under what name.

Ricardo derives income by charged 2010 fees for managing and administering the R&D centre plus a service charge.

Ricardo said in a note to its annual financial results statement yesterday that SAIC will keep the operation at Leamington and buy in administrative services from Ricardo.

The Sussex-based group yesterday reported underlying profits before tax for the year to June 30 of pounds 14.5 million, an increase of 26 per cent over the previous 12 months. That figure excludes an exceptional payment of pounds 3.7 million into the group's pension fund.

Turnover last year rose by nine per cent to pounds 173 million.

Ricardo, which works closely with most of the world's major carmakers and Tier One components suppliers, said that despite the "continued challenges" facing the industry, its order book grew year on year to pounds 72.2 million from pounds 69.7 million and that it has a "strong pipeline of prospects".

The company's flagship projects include work on the world speed record-beating diesel-powered JCB vehicle and transmission systems for supercars such as the Ford GT and the Bugatti Veyron.

It is also working on clutch components for the MacLaren Formula One car.

Chief executive Dave Shemmans said: "I am very pleased with this set of results that again show stronger revenues and growth in profits.

"Our Leamington operation is absolutely buzzing and is going from strength to strength."
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Title Annotation:Business
Publication:The Birmingham Post (England)
Date:Sep 19, 2006
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