Nanjing Automobile signed a long term lease to return carmaking to Longbridge yesterday - but only after a £1 million aid package was agreed at the 11th hour.
The Chinese car maker insisted it had the money in place to restart production and would stay longer than the six-month break-off period agreed in the 33-year contract.
But the deal, which could ultimately lead to 1,000 jobs, was only finally cleared in the early hours of yesterday after Birmingham City Council and Advantage West Midlands agreed to put in £666,000.
The money, augmented by £333,000 from Nanjing, will be used to decommission the two waste treatment plants on the Longbridge site and build another one close to where Nanjing plans to resume car production.
Clive Dutton, development director at Birmingham City Council, said: "This was a real deal breaker and we had our lawyers working overnight.
"There was some hard negotiations between us, St Modwen and Nanjing to narrow the deal."
Nanjing Automobile Corporation (NAC) needed another effluent treatment plant near the South Works it will use, while it also needed to decommission the existing facilities next to the north and western part of the site, which it will not be occupying.
"Somebody had to pay for that, and Nanjing did not want to pay for it all," said Mr Dutton.
Council leader Mike Whitby said: "We agreed to the £333,000 because we are totally committed to making this relationship work."
Site owner St Modwen said it was now looking forward to a "long and fruitful" relation-ship with Nanjing, which bought MG Rover for £53 million last summer.
The agreement is for Nanjing to take the 33-year lease at a rent of about £1.8 million a year on 105 acres of the 469-acre site.
The deal covers the South Works of the former MG Rover plant, incorporating two car assembly plants, the paint shop and administrative offices.
Nanjing said it would press ahead with its plan to resume car production in 2007 and the plant would ultimately employ several hundred people, perhaps up to 1,000.
Doubts had arisen whether Nanjing would be able to extend its stay beyond the six-month period of the lease, or can raise the estimated £100 million needed to resume production.
Wang Hongbiao, chairman of Nanjing Automobile (UK) said: "We move forward according to our original plan.
"Next year we will produce a sports car here. After that, we will produce a car which will make profits.
"We will stay longer than six months. Yes, we have the money. If we don't have the money how can we restore production here?"
Mr Wang would not say where the funds came from, saying only: "All the money will come from the bank, because that's where all money comes from."
Coun Whitby (Con Harborne) said: "This is a day that many people thought would not come."
Labour MP Richard Burden, whose Birmingham Northfield constituency takes in the former MG Rover car plant, said it was "positive news".
"My welcome is tempered by realism. This is not mass car production at Longbridge. We're talking about, in the early stages, well under 1,000 jobs," he added.
"The key thing for this area is how the contribution from NAC can link in with the development of the rest of the Longbridge site and developments in south west Birmingham."