NEC Group up for sale
Birmingham City Council are seeking offers for the NEC Group following a strategic review.
In a statement, the council said “bringing the NEC Group under private ownership will enable the business to take full advantage of its growth opportunities and reach the next stage of its development.”
Potentially interested buyers will be invited to participate in a pre-qualification process while sale preparations are finalised.
In structuring a transaction, the council wants to ensure that the existing uses of the exhibition centre, International Convention Centre and two arenas – LG Arena and National Indoor Arena – are preserved.
The city council also intends to retain claw-back rights over certain land at the main NEC site, so ensuring that it preserves potential future development value from a highly attractive site that will be adjacent to the Birmingham Interchange HS2 station.
Birmingham City Council leader, Sir Albert Bore, explained the decision: “A key purpose of the City Council investing in establishing the NEC Group more than 30 years ago was to drive economic development and regeneration.”
“This has been achieved, but now the NEC Group has reached a point in its evolution where it needs to be able to adopt the financial disciplines of a private, rather than a council-owned company to enable the next stage of strategic development. In doing so, economic impact and job creation can be preserved and enhanced.
“An open sale process has been identified through an extensive strategic review process as the way to achieve full value for this internationally-renowned asset, whilst achieving the other principal objectives of enabling the Group to achieve its potential and growing economic impact.”
In a statement, NEC managing director Kathryn James said the decision by Birmingham City Council to put the group up for sale will help it remain the venue of choice for events in the UK and further afield.
Kathryn added: “Restrictions in the NEC site lease will preserve its use as an exhibition venue, and with the fantastic array of live events at The NEC – and across the NEC Group as a whole – that will be the main attraction to purchasers.
“The latest industry figures reinforce the NEC’s position as the UK’s number one with over 500 events held in 2013/14. We expect our exhibitions portfolio to grow to over 150 in 2014/15 and private ownership will enable us to grow further and faster, realising our full potential.”
The NEC group’s chief executive Paul Thandi said the decision to seek a new ownership structure is “the next stage in the group’s development and is a decision the business welcomes.”
He added that a move to private sector ownership will provide capital to be put to use with a higher degree of risk than the council can associate itself with, and will support vision and ambition for future growth.