Decision details

To agree the preferred and reserved bidder for the airport disposal at an agreed sale value range

The Director of Development submitted a report advising Members of the progress made with the sale of 100% of the share capital in the Leeds Bradford International Airport Limited and seeking Members’ approval to the selection of a preferred and reserve bidder for the transaction to enable officers to complete the disposal.

Following consideration of Appendices 1 and 2 to the report designated exempt under Access to Information Procedure Rule 10.4(3) which were considered in private at the conclusion of the meeting, following distribution of Appendix 2 at the meeting, it was

RESOLVED –

(a)  That the disposal of all of Leeds City Council’s share capital in Leeds Bradford International Airport Ltd as part of a 100% share disposal of the airport company to Bridgepoint be approved;

(b)  That authorisation be given to the Chief Executive or the Chief Asset Management Officer as the nominated deputy, to complete the transaction in the form outlined in the exempt appendices to the report;

(c)  That £7,500,000 from the disposal be placed in an escrow account to meet the potential cost of the pension deficit of Leeds Bradford International Airport Ltd once it leaves the West Yorkshire Pension Fund;

(d)  That the same escrow account shall meet the potential cost of the pension deficit for security staff transferred under TUPE to Group 4 on the basis set out in the exempt Appendix 1;

(e)  That Leeds City Council, in conjunction with the other shareholders, acts as one of the ‘guarantors’ underwriting any further pension deficit shortfall in proportion to its previous shareholding and meets the other pension obligations outlined in paragraph 3.2.5 of the report.

(f)  That the requirement for all non-executive directors of the airport company to step down as part of the transaction process be noted and that full Council be recommended to authorise the Chief Executive to effect the removal of the non-executive directors before the transaction completes.

(g)  That a special share be held by this Council in conjunction with the other four West Yorkshire council’s for the purposes outlined in the report.

(h)  To note that, in line with previous delegations, the land held by the five shareholders identified in pink on Plan A is to be sold to the airport company as part of the disposal transaction with overage provision.

(i)  To note that, in line with previous delegations, the end purchaser will be offered a two year option to purchase the land shown pink on Plan B at a value of £2,973,000 plus RPI with overage provision.

(j)  To authorise the Chief Asset Management Officer to approve the terms of a legal agreement to be entered into with the other shareholders to determine how the apportionment of the residual liabilities will be managed after the signing of the share purchase agreement.

(k)  That in the event that the preferred bidder changes their bid in a manner which results in the reserve bidder’s bid being more economically advantageous, authority be delegated to the Chief Executive, with the concurrence of the Leader of the Council, to take any action necessary to secure completion of the disposal in the circumstances outlined in paragraph 4.3 of Appendix 1 of the report.

(l)  That the communication proposals outlined in the report be approved.

(m)  That Martin Farrington and Paul Brook of the Development Department and other officers involved in progressing this disposal be thanked for their work in this respect.

(Councillor Harker declared a personal interest in this matter as a member of the West Yorkshire Pension Fund Joint Advisory Group).

Asset Management Group , Leader of the Council and Executive Board members