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Acting for a council on the sale of its bus company

In 2005/6 we acted for a borough Council on the successful sale of its 100% publicly owned bus company. We worked closely with the Council’s in-house technical and legal teams, as well as external financial advisers, for the duration of the project: from the early, scoping stage through to completion of the sale.

This project drew on the expertise and skills of a large number of individuals from a number of teams within Bevan Brittan.

The work involved initial advice on the powers of the Council to undertake the project, the potentially conflicting role of elected members and council officers in acting as owners and directors of the bus company.

We explored options for routes to market including the relevance of regulated public procurement and state aid to the disposal of an asset owned by a local authority. We also considered potential joint venture, outsourcing and PPP options.

The project involved discussions with the Department for Transport of their regulatory role in approving the sale of shares and detailed advice on the interface between Secretary of State consent and the sale process

During the sale process we reviewed and/or prepared the relevant tender, sale and contract documents including advising on the form of advertising, confidentiality agreements and the asset transfer (company disposal) and company secretarial documents. The asset sale component included advice provided as a matter of course on such transfers including consideration of assignments, licences and taxation. We also reviewed the Council’s own internal decision making documents and committee reports.

As the sale involved the transfer of property we also liaised and advised on major property issues relating to bus depot ownership, site redevelopment and planning. The interest expressed in the sale by a number of local and international transport companies required specialist advice on competition law in the context of local bus markets and international transport companies.

A significant number of staff were potentially affected by this organisational change and so we advised on data protection, staff and trade unions issues linked to the change of ownership of company as well as providing specialist pensions advice.

The sale process was challenged (unsuccessfully) by disappointed tenderers and so we advised on threatened judicial review proceedings and other litigation. The project was also the subject of repeated Freedom of Information Act requests which we worked on jointly with the in-house legal team. Constant press and public interest in the project involved detailed advice on the balance between confidentiality of commercial issues, the Council’s duties and the broader public interest.

Working with Bevan Brittan

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