UK fraud office: no criminal probe of MG Rover sale

(corrects typo in paragraph 4)

LONDON Aug 11 (Reuters) - Britain's Serious Fraud Office will not carry out a criminal investigation into the sale and collapse of carmaker MG Rover Group, it said on Tuesday, but did not provide any reason for its decision.

The SFO said in a statement it had reviewed documents relating to the transaction and the 2005 demise of the company and determined after consultation with legal advisers that there were no grounds "to initiate a criminal investigation".

MG Rover, Britain's last major independent carmaker, went into administration in April 2005 with debts of almost 1.3 billion pounds ($2.15 billion) and the loss of 6,000 jobs.

In July this year, following the publication of a four-year probe into the demise of the now Chinese-owned car plant, the department of business asked the SFO to determine if there were any grounds for criminal prosecution.

Four executives, known as the Phoenix Four, took over MG Rover in May 2000 after buying it for a nominal 10 pounds with an interest-free loan from a previous owner, German car group BMW (BMWG.DE).

The four have said there was no basis for an SFO investigation.

A 2006 parliamentary committee criticised the government for its handling of MG's collapse, citing specifically its lack of dealings with the company's new owners and a lack of preparation before the firm went bust.

Opposition politicians accused the government of wasting millions of pounds of taxpayers' money to prop up the ailing carmaker in the run-up to a parliamentary election in 2005.