Burges Salmon has advised longstanding client FirstGroup on the sale of eight of its London bus depots, as part of the transport operator’s strategy to reposition its UK Bus division to focus on those areas that offer the greatest potential for growth.
Five bus depots at Alperton, Greenford, Hayes, Uxbridge and Willesden Junction, along with 494 vehicles and approximately 1,700 employees, will transfer to Metroline on completion of the sale for a gross consideration of £57.5 million. Metroline is an existing London bus operator and wholly-owned subsidiary of Comfort DelGro Corporation Limited, a Singapore-incorporated transportation company.
A further three bus depots at Atlas Road, Lea Interchange and Westbourne Park, along with approximately 400 vehicles and 1,500 employees, will transfer to Transit Systems Group, an Australian transport operator, on completion of the sale for a gross consideration of £21.3 million.
Both disposals are subject to the necessary regulatory approvals including contractual obligations with Transport for London.
Commenting, Giles Fearnley, First’s Managing Director UK Bus, said: “The sale of these operations marks further progress in our programme to reposition our UK Bus portfolio, recover performance and equip the business to achieve sustainable revenue and patronage growth. Our strategy is to focus on those areas of the country which offer the greatest potential and while we have been a key operator in London for many years, our focus going forward is on the deregulated market outside of the capital.”
The 15-strong Burges Salmon team was led by Rupert Weston and Ed Barratt. As well as corporate lawyers Tim Roberts, Gillian Saunderson, Richard Alexander and Ashley Crathern, the team also included specialist advisers on tax, pensions and UK bus regulations. Sandra Forbes led a finance team of Katie Allen, Alistair Rattray, Elin Blundell and Richard Clark which dealt with the transfer of numerous bus operating leases held with a number of different financial institutions.
Rupert Weston said: “This was a highly complex piece of work involving two separate cross-border transactions, which each had to be co-ordinated and completed within tight deadlines across three time zones. We were able to draw on the strength and breadth of the Burges Salmon team by combining our technical expertise with in-depth knowledge and experience of the regulations governing bus services in London. We are delighted once again to have been part of the FirstGroup team ensuring delivery of their strategic aims.”
First’s Managing Director UK Bus, Giles Fearnley, added: “This decision is a business driven one and does not reflect on the effort, commitment or individual performance of our employees in London and we will be supporting them fully as they transfer to their new employers. Over the years we have enjoyed a constructive relationship with Transport for London and look forward to working closely with them to ensure this transfer goes ahead as smoothly as possible.”
http://www.burges-salmon.com/Practices/corporate/News/10743.aspx
