Citybus Sale: Latest

"This is not privatisation. Bus companies were deregulated in 1986, and Citybus already operates independently of the council” Citybus Sale Timeline

News from This is Plymouth yesterday: Plymouth City Council finance chief Ian Bowyer has come out fighting in the row over the council's plan to sell its shares in Citybus. Cllr Bowyer, the Cabinet member for finance and budget, has been forced to remain silent in the row until now because he owns shares in Taxibank, which was part of a consortium bidding to buy Citybus. The Herald understands that the consortium, led by Taxifast boss John Preece, is no longer being considered as a bidder. Mr Bowyer said: "A significant sum is likely to be raised which could be invested to produce a higher return at lower risk. "There has been a lot of speculation that a sale would be used to pay for the Life Centre. I don't think that's the right way forward. "I want to see a lasting legacy which can be used year on year to improve services to people in Plymouth. Five companies have put in bids to buy Plymouth City Council's shares in Citybus. A "significant number" are "well in excess of £10million". But the giant First Group has pulled out of the competition, The Herald has learnt. Council officers believe that the Competition Commission would have intervened because First is already a major bus operator in the city. "The Government has been keen to make sure all councils make the best use of assets to ensure best value for money for taxpayers, and I agree with this policy. "The council does not have the level of expertise to run a bus company. This view is held by most councils: there are only 13 in the country which continue to run buses. Mr Bowyer said research had shown that the economic downturn was a good time to sell bus shares because bus operators do well in a recession. "Citybus is a well run company and has returned a small annual dividend to the council over the years. But in terms of the wider market it is a small cog and can be susceptible to the vagaries of that market." He said it was inconceivable that any new owner, having invested millions, would want to dismantle the company. "The owner would want to grow the business and this would provide opportunities for more routes and lower fares. "The city has two major bus operators and, should a sale take place, this will remain the case. "This is not privatisation. Bus companies were deregulated in 1986, and Citybus already operates independently of the council." View Archive Copy HERE So we know there are five companies bidding for Citybus and that no longer includes Taxibank or First. I have heard from two different people that they believe a French company is one of the bidders although neither knew who that was likely to be. Transdev sounds the most likely I guess but we will clearly have to wait a while longer before we find out. There are a couple of other comments made above that are interesting: The idea that now is a good time to sell seems at odds to what most people think. Just this year Rosendale Council decided against putting their bus company up for sale for because now was not a good time to sell. As for “This is not privatisation….” well this is being very pedantic to say the least! The sale of a publicly owned asset to the private sector is privatisation in most peoples book. Going by his definition above then most of the big privatisations of the 1980’s were not privatisation either.

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