Coach and Bus News
Page 20
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NBC market value
STOCK EXCHANGE member Grieveson Grant and Company has published a report on the privatisation prospects of the National Bus Company.
The report suggests that NBC has a potential market value of between £200m and £250m as a group and that it will attract considerable interest when it transfers to the private sector.
Bearing in mind plans to abolish metropolitan councils and the possibility that some PTE services may be transferred to NBC operators, the report suggests three main options for privatising the Group.
According to the report the most attractive option for NBC privatisation would be to sell the group as a whole to the public by an offer for sale by an issue of shares. A second option would be to sell the group as a whole to a particular group or consortium including a management or staff buy-out.
Grieveson Grant believes that Option One could be the most attractive to the Transport Minister on balance, as loss making operations would be included with the more profitable operations. This option would also be simple to implement. Option Two could be similar to the National Freight buy-out, but according to the report the proceeds may not be so high as in the first option.
The third option suggested, and the one favoured by the White Paper is to break up the group into various small operating companies and sell each to private investors or groups.
The report suggests that the problem with this option would be that not all the companies in the Group might find buyers. It asks what would happen to the unsold companies and it also feels that this would produce the lowest return.
Suggestions that NBC is privatised in two parts, splitting the National Express and local bus businesses, are looked at in the report. Advantages for this are said to be outweighed by disadvantages and the report feels that if possible the integrated group network and hub system should be preserved.
Coming to the City? is published by Grieveson, Grant and Co, PO Box 191, 50 Gresham Street, London EC2P 2DS.