Jon Moulton is fond of standing out against the crowd. The man who has agreed to take over Rover Cars from BMW of Germany was invited earlier this year to give some advice to fellow venture capitalists. "I put up one slide saying `Go on holiday', picked up my bags, and left the stage," he says.

Mr Moulton's point made with characteristic insouciance, was that there are few money-making opportunities for private equity firms at the peak of the market. He has not taken his own advice, but his decision to acquire the troubled Rover group is equally unconventional. While Alchemy Partners, Mr Moulton's private equity firm, doggedly acquires and turns around industrial companies, other venture capitalists are looking elsewhere.

Such firms as Carlyle Capital Partners and Doughty Hanson are raising funds to invest in the Internet and software ventures.

His investments in companies such as AG Stanley, owner of a do-it-yourself business, and Parker Pens, are admired ruefully by rivals. "It takes an awful lot of credibility to persuade BMW to do a deal, and an awful lot of skill to make money from it," says Peter Taylor of Duke Street Capital.

Mr Moulton appears unworried at the prospect of taking on a loss-making car maker that BMW was no longer willing or able to support.

"There are not many others in the industry who are mature enough or have our risk tolerance to take on this deal. With the brain engaged I will try to enjoy it," he says.

Yet the deal, which was under negotiation in secret for several months while the British government offered state aid to BMW to maintain production at Rover's plant at Longbridge in the West Midlands, will present a new challenge. Mr Moulton must now operate under the scrutiny of politicians who equate private equity firms with "asset strippers", and question whether a car company can be run by an investment fund.

Nor is Mr Moulton a politician himself. His fondness for straight talk leads to the odd tactless metaphor when he discusses potential job losses at Longbridge. Unions fear that at least 4,000 jobs could go as Alchemy transforms Rover into a specialist carmaker under the MG Cars brand.

"Making people redundant is not a nice thing to do to a human being, but nor is removing haemorrhoids and sometimes that needs to be done," he says.

Yet Mr Moulton is not a City banker with little interest in, or knowledge of, British industrial tradition. He was born in Stoke-on-Trent in 1951, and enjoyed a typical childhood until his teenage years. A bout of tuberculosis followed by a rare blood disease came close to killing him. Mr Moulton studied chemistry at Lancaster University, but became interested in business by spending time at his uncle's engineering company. This was followed by qualifying as an accountant at Coopers & Lybrand. At the age of 23, he became part of the firm's receivership operation.

Among his early cases was the collapse of a company making tights, which involved him in decisions leading to 600 workers losing their jobs. A secondment to Coopers' New York office led to a meeting with Citicorp Venture Partners and a move into private equity.

He subsequently launched its London office before moving to head up Schroder Ventures. A fall out with the parent company prompted a move to Apax Partners before he stopped working for others and set out on his own in January 1997.

Alchemy was established as private equity firms, which try to make money by acquiring undervalued companies, improving their operations, and then selling them again after three to five years, were expanding rapidly in Europe.

In some ways, Alchemy is a conventional private equity firm. It has made 37 deals since it started, although it has not been going long enough to have realised many investments.

One company from which it has exited is AG Stanley, and Mr Moulton estimates it made a £35 million (#57 million) profit on a £3 million investment in the company.

However, its trademark has been to stick to traditional deals management buy-outs of mature businesses while others have been drawn into Internet start-ups. Alchemy's portfolio ranges from open-cast mines to pubs, and it has done deals eschewed by others because they involve loss-making companies.

"Jon loves doing deals with forced sellers. We work out how desperate a seller is," says one venture capitalist.

This means that Alchemy's approach involves gambling on being able to turn around companies that others regard as lost causes. "I would put my own money with him any day," says a former colleague. "But I would have to close my eyes for several years."

Mr Moulton says his approach is exemplified by the buyout of Parker Pens, which he led in 1986. The company had drifted away from its core product high-quality fountain pens and the management team he backed reversed this. "It had losses of £20 million when we got involved and profits of £43 million when we left seven years later," he says.

Such overhauls are rarely painless. The first step is often to cut costs and reduce the workforce, before investing in new products and marketing. The executives who carry out such re-engineering on his behalf generally speak highly of him.

Jurek Piasecki, the chairman and chief executive of Goldsmiths jewellery chain, has completed two buyouts with Mr Moulton.

"The lines of command are always short and decision taking is fast. He surrounds himself with good commercial people, he is fair to his management teams and personally he is a bubbly character," says Mr Piasecki.

He encourages such loyalty by making sure not to interfere directly in the day-to-day running of the companies he owns.

He has no truck with what other private equity firms call "adding value". Instead, he prefers to find competent managers, and leave them to it. "If they, the managers are bad, you spend all your life dealing with the bloody companies. If management is used to the process, it's a doddle," he says.

In an industry packed with grey figures, Mr Moulton stands out. He is happy to proclaim the number of millionaires he has helped to create - more than 200, according to his estimates.

He is also willing to make snap decisions on potential deals while rivals undertake weeks of diligence.

Mr Moulton, who has been married for 25 years and has two children, does not allocate much time to relaxation. He runs half marathons to keep fit, and has a trust that makes contributions to medical charities. But deals even form part of his life away from the office. He has a private portfolio of 40 investments, including a share in a number of Scottish forests jointly owned with Guy Hands, the Nomura financier who is a neighbour of the Moultons.

So far, Mr Moulton has refused to be put off by the controversy, and the doubts expressed by Stephen Byers, the industry secretary. On Thursday, when Mr Moulton announced plans to take over Rover, he also got to three meetings relating to new investments.

Yet Mr Moulton is already finding out that Rover Cars will not be just another deal. Transforming the company and winning the backing of politicians and workers will take more than financial wizardry and a willingness to defy the crowd.