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Archive
2001-05-29 CON-001
Connex
Connex Transport UK Limited sale of Connex South Central Limited to Govia Limited
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Press release
Connex
Connex Transport UK Limited sale of Connex South Central Limited to Govia Limited
date 29 May 2001
source Connex
type Press release
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Connex Transport UK Limited is pleased to announce that it has exchanged contracts today with GOVIA, Go-Ahead's 65 per cent owned subsidiary, in respect of the sale of Connex South Central Limited ("Connex South Central"), together with the transfer to GOVIA of the franchise agreement to operate commuter trains on the South Central network. Completion is expected to take place before the end of July.
On completion, GOVIA has agreed to pay Connex Transport Limited a sum of £30 million in cash as compensation for the early transfer of the franchise (Connex South Central's current contract terminates in May 2003). The price of £30 million is made up of £12.8 million for net assets and £17.2 million before taxation for compensation for post-completion profits. Up to £2.5 million will also be paid based on any increase in the net assets of Connex South Central from 31 December 2000 up to completion. Lastly, a further amount is payable, contingent upon passenger revenues earned by Connex South Central exceeding an agreed level, in respect of the year ended 5 January 2002. This further amount will nevertheless be capped at £10 million.
As at 30 December 2000, Connex South Central's audited net assets were £12.8 million and, in the 52 weeks ended 30 December 2000, it recorded a profit before taxation of £9.0 million on turnover of £308 million.
Both parties have agreed to work in full co-operation in order to ensure that the handover will be made as smoothly as possible in the best interests of customers and staff.
Antoine Hurel, Chairman of Connex Transport UK, said:
"We are pleased to have reached a mutually satisfactory agreement with Govia. We now see the end of uncertainty for our staff and customers regarding the handover date and are able to concentrate on the smooth and efficient transfer of the franchise. We are committed to forging long-term partnerships with the community and implementing what is best for our customers.
"The transfer of the Connex South Central franchise will enable us to focus on delivering further improvements to our passengers on our remaining franchise, South Eastern, and to consolidate and increase the improvements in efficiency and customer service that have already begun to be generated. We are confident that Govia will build on the recent trend of improving service performance to deliver an excellent operation."
Railnews Archive ::: 2001-05-29 CON-001
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