Amey facing £200m Birmingham divorce bill

18/02/2019 | DOM BROWNE

Amey could be set to pay more than £200m to extricate itself from its troubled 25-year PFI contract with Birmingham after years of legal difficulties, according to reports.

The Sunday Times has reported that Amey's parent company, Spanish infrastructure giant Ferrovial, hopes to terminate the deal to expedite its planned sale of Amey.

PAI Partners and Greybull Capital are understood to be waiting in the wings to potentially acquire the contractor, which, despite going through a difficult period, is winning work again on England's strategic road network.

”Local
 

The news comes after Amey lost a five-year legal in the Appeal Court with Birmingham over the £2.7bn deal. Lord Justice Jackson said Amey had applied an 'ingenious new interpretation of the contract' to avoid certain repairs.

It is understood Amey is in talks to get out of the contract but negotiations could be difficult. Reports suggest the local authority may be holding out for a settlement of £300m or more.

The council told Transport Network that £55m plus interest owed by Amey remains unpaid, which will also factor into the talks.

Amey already wrote off £208.5m on the deal last year and it seems Ferrovial, which also co-owns Heathrow, may be looking to cut it losses.

A council spokesman said: 'We continue to work with all stakeholders to achieve a consensual replacement of Amey as soon as practicable and with regard to ensuring continuity of service.'

An Amey spokesman said: 'The Birmingham contract is just one of hundreds of contracts across the UK which Amey operates successfully. It is no secret that the ongoing dispute in relation to the Birmingham Highways PFI deal remains a challenge.

'That is why we are working closely with Birmingham City Council, Cabinet Office and a range of other stakeholders to reach a resolution which is in the best interests of all sides, and importantly delivers for the people of Birmingham. We will continue to meet our obligations under the contract for the remainder of its term to 2035, or until such time an alternative position is agreed.

'Amey is a well-managed company, and has a strong cash position with positive cash flows. We disclosed zero external debt in our last audited accounts, a conservatively managed pension fund and a forward order book of over £11bn which we look forward to delivering.'

PFIs have a had a mixed history in local highways, with Birmingham and the Isle of Wight arrangements raising some disputes, however the PFI in Hounslow is understood to be operating very well.

Highways InProfile

latest magazine issue
Highways jobs

Traffic Management Officer - WMF2114e

£37,035 - £37,938
Are you an experienced and motivated professional looking to take the next step in your traffic management career? Cumbria / Various
Recruiter: Westmorland and Furness Council

Senior Transport Planner

£47,532 - £50,574
Royal Greenwich is a borough synonymous with first class modern services Greenwich, London (Greater)
Recruiter: Royal Borough of Greenwich

Technician - Highway Inspector

Grade 8 £28,797 - £30,708 per annum (Pay Award Pending)
Within the Highways Maintenance Team we are looking for an enthusiastic, customer focused and experienced person to join the Service Derbyshire
Recruiter: Derbyshire County Council

Project Delivery Senior Team Leader

£74,480 - £85,964
Are you an experienced Chartered Civil Engineer (or equivalent professional qualification) Glasgow City
Recruiter: Transport Scotland

Assistant Traffic Management Technician - WMF2104e

£25,584 - £25,992
Westmorland and Furness Council is seeking an organised and enthusiastic individual to join our South Lakeland team Kendal, Cumbria
Recruiter: Westmorland and Furness Council

Bulky Operative

£25,584.00 - £27,269.00, Grade 5, 37 hours, Permanent.
An opportunity exists in the Council’s Street Scene Services for a Bulky Operative Wakefield, West Yorkshire
Recruiter: Wakefield Council

Project Delivery Team Leader

£57,710 - £71,842
Are you an experienced Chartered Civil Engineer (or equivalent professional qualification). Glasgow City
Recruiter: Transport Scotland

Traffic Management Officer - WMF2102e

£37,035 - £37,938
This is a key role supporting the delivery a wide range of traffic and road safety schemes. Kendal, Cumbria
Recruiter: Westmorland and Furness Council

Shared Service Manager (Waste) North Herts Council

£52000 - £61000 per annum
Shared Service Manager (Waste) North Herts CouncilNorth Herts CouncilPermanent, Full Time£52,866 - £61,866 per annum, plus car allowance (pay award pe England, Hertfordshire, Letchworth Garden City
Recruiter: Essex County Council

Street Scene Protection Officer - Braintree District Council

£30000 - £34000 per annum
Street Scene Protection Officer - Braintree District CouncilBraintree District CouncilPermanent, Full Time£30,313 to £34,612 per annumLocation
Recruiter: Essex County Council

Traffic Management Officer - WMF2102e

£37,035 - £37,938
This is a key role supporting the delivery a wide range of traffic and road safety schemes. Kendal, Cumbria
Recruiter: Westmorland and Furness Council

Assistant Traffic Management Technician - WMF2104e

£25,584 - £25,992
This is a key support role, helping to deliver a wide range of traffic and road safety schemes across South Lakeland. Kendal, Cumbria
Recruiter: Westmorland and Furness Council

Flood Risk Engineering and Strategy Officer

£49,764 - £55,623
In line with our One Coventry Values, we want to ensure that our communities are represented across our workforce Coventry, West Midlands
Recruiter: Coventry City Council

Senior Integrated Transport Officer

£34,324 - £37,529
Are you an experienced transport planning professional ready to influence strategic policy and drive real change Matlock, Derbyshire
Recruiter: Derbyshire County Council

Roadworker Trainee LGV Driver (3 Posts)

Grade 6 £25,183 - £25,638 per annum (Pay award pending)
We’re looking for Roadworker/trainee LGV drivers to be part of our team undertaking major highway, bridge and related construction and reconstruction Derbyshire
Recruiter: Derbyshire County Council

Engineer

£44,430 - £51,663
This post is within the Highways Design and Delivery Team. London (Greater)
Recruiter: Tower Hamlets London Borough Council

Civil Enforcement Officer - WMF3013e

£27,711 -£28,624
Are you seeking an active and challenging role, part of a friendly and welcoming team? Cumbria / Various
Recruiter: Westmorland and Furness Council

UGO Bus Driver

Up to £25081.00 per annum
UGO Bus DriverPermanent, Part TimeUp to £25,081 per annum (full time equivalent)Location
Recruiter: Essex County Council

Head of Highways Operations

Salary
Somerset Council
Recruiter: Somerset Council

Works Technician

£37,399 (plus unsocial hours allowance)
The Works Technician is responsible for ensuring that the London Trams civils and off-track infrastructure Croydon (City/Town), London (Greater)
Recruiter: Transport for London
SUBSCRIBE NOW

Latest Video

Subscribe to Highways today to ensure you keep your finger on the pulse of everything happening in the UK road network throughout the year.

SUBSCRIBE NOW