MG Rover Ireland owes between €5 million and €7 million to a subsidiary of its parent group.

A number of sources confirmed yesterday that the Irish company's largest creditor is likely to emerge as MG Rover Exports, the company that supplied the stock to the motor distributor.

While details have yet to be finalised, it is understood the figure will be between €5 million and €7 million.

The Irish subsidiary of the UK motor manufacturer was effectively placed in administration last April, along with its parent, after the Shanghai Motor Company announced it would not proceed with a planned investment.

While administration is a UK mechanism for insolvent companies, EU law allowed its subsidiaries within the Union to be placed in administration along with the parent.

The Irish company also has a number of other creditors, including Rover dealers, who are owed cash from rebates and warranties, and its former workers.

Its assets include debtors and car stocks, which dealers are continuing to sell.

Staff from PricewaterhouseCoopers, the administrator, met creditors in Dublin yesterday to outline the strategy for the company.

They also told the meeting that there was little prospect of a sale of the brand and other assets at this stage. PricewaterhouseCoopers in Leeds is managing the administration.

Rover dealers have put in place a mechanism to ensure that warranties on cars already sold, and those still in the forecourts, will be honoured.

Cars sold since January 2004 will be guaranteed for one year from the date of the parent going into administration, those sold since January of this year will have a two-year warranty, as will those sold since the date of the administrator's appointment.