16.01.15
Birmingham City Council to sell the NEC
Birmingham City Council has agreed to sell NEC Group, including the NEC Exhibition Halls, the Genting Arena, the International Convention Centre (ICC) and the Barclaycard Arena, to LDC for £307m.
LDC – the private equity arm of Lloyds Banking Group – was selected after an extensive sale process, the council announced.
The transaction values the NEC Group at around £307m, £15m of which will be in the form of a loan note, including the value of the leases of the Hilton Metropole and Crowne Plaza hotels on the NEC site. These are being retained by the council.
The sale includes all NEC Group businesses, with the council providing a 125 year leasehold interest in the NEC site (including the NEC Exhibition halls, The Genting Arena – formerly the LG Arena – and the Resorts World development), and 25 year leasehold interests in the International Convention Centre and Barclaycard Arena (formerly the National Indoor Arena).
The deal will see the council retain freehold of all the NEC sites and also allows the council to “claw back” certain non-core land at the NEC site for future development.
Sir Albert Bore, leader of Birmingham City Council, said: “The announcement of a new owner is a landmark moment in the history and development of the NEC Group and its three operating sites: NEC, ICC and Barclaycard Arena.
“We are very pleased to have attracted a Birmingham-based buyer in LDC that understands the local importance of the NEC and shares our vision for the future. This will ensure that the business goes from strength to strength, and that the NEC continues to play a leading role in the wider economic development of the region whilst securing Birmingham and the wider West Midlands’ position as the home for outstanding live events. We are looking forward to working alongside LDC to achieve this goal.”
Martin Draper, LDC’s chief executive officer, said: “The NEC Group is one of the UK’s best known and iconic businesses, particularly so in the Midlands, where it is at the heart of the region’s commercial and leisure activities.
“The NEC Group has developed significantly over recent years and we are delighted to be working with such a strong and experienced team to deliver the NEC’s next exciting phase of development. We also look forward to working closely with both Birmingham and Solihull Councils to support their plans at both the NEC and City Centre sites which include the airport expansion, redevelopment of the Paradise Circus area and in connection with the HS2 project.”
The transaction is expected to complete in the second quarter of 2015.
(Image credit: Snowmanradio)
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