I would think you would need £3k+ to put a cossie near an E36, I like how the BMWs are so balanced but my 2wd is getting there. As said, 6degree rear beam and poly diff mount , poly bushed front end to match, 17"s with at least 215mm rubber and touch better brakes, and koni shocks or soft coilovers.
Then you will want 280-300+ bhp to keep with the BMW in a straight line and a clutch to match oh and a diff to put the power down and get that nose turning in and putting power down on exits. It's not as good value for money but it's certainly possible to make then handle.
I'd have an M3 as a value for money performer but I own a cossie for fun