Manchester bus company won by employee buyout

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The Independent Online
THE CONTROVERSIAL privatisation of Greater Manchester's municipal bus services concluded yesterday with a dramatic final round of sealed bids that confirmed an employee buyout as the winner of GM Buses North, one of the two companies being sold, writes John Murray.

The employees won with a bid of pounds 27.1m, pounds 1.1m higher than their previous offer. The rival bid from British Bus, a private company, was higher, but employee buyouts are allowed a 5 per cent discount.

It is understood that the employee bid squeezed in underneath that margin yesterday by just pounds 25,000.

Greater Manchester Passenger Transport Authority asked for the last-minute bids after receiving legal advice that councillors might be liable for personal surcharge by the district auditor if they failed to get the best price for the bus company.

Roger Freeman, the transport minister, warned the authority that the Secretary of State would block the sale if the employees were unfairly favoured.

Another employee buyout won the battle for GM Buses South, but the losing bidder, Stagecoach, the Perth-based quoted bus group, argued that it should be allowed to rebid after the bidding was reopened for GM Buses North.

The employees of GM Buses North have put pounds 2.5m of their own money into the buyout, with more than 95 per cent of employees subscribing for more than pounds 1,000 worth of shares. They will own 25 per cent of the company, with the rest in the hands of institutions.