Court of Appeal Hearing re. GMCA
25/07/2022 11:29
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RNS Number : 6283T Rotala PLC 25 July 2022
RNS
25 July 2022
Rotala Plc
("Rotala", the "Company" or the "Group")
Court of Appeal Hearing re Greater Manchester Combined Authority
On 26 March 2021, the Company announced that the Mayor of Greater Manchester
(the "Mayor") had made the formal decision to franchise the bus market in the
Greater Manchester region. The Company made an immediate claim to the High
Court of Manchester to judicially review a number of aspects of the
consultation process carried out by the Greater Manchester Combined Authority
("GMCA"') which led to the decision of the Mayor to franchise the bus network.
As previously announced, on 9 March 2022, Mr Justice Julian Knowles rejected
these arguments, dismissed the claim and refused to give leave to appeal. The
Company applied to seek permission to appeal the decision to the Court of
Appeal and was granted leave to appeal. The appeal hearing took place on 12
July 2022. Today the Court of Appeal released its judgement: it dismissed the
Company's appeal. The Company has considered the Court of Appeal's judgment in
its claim against GMCA and the Mayor and, whilst disappointed with the result,
it respects the decision of the Court and has resolved to take no further
steps in this legal process.
GMCA has already announced mechanisms which cover the acquisition of bus
depots and bus fleets under its franchising proposals. The Board has reviewed
these mechanisms and is confident that, should it decide to place the Bolton
depot and its associated bus fleet assets under these mechanisms, the values
which would be realised from the sale of Bolton depot and its related bus
fleet should meet or exceed their respective book values. These amounts should
also be more than sufficient to pay off the existing mortgage on the Bolton
depot and the hire purchase debt associated with the bus assets based there.
As a result, the sale of these assets to GMCA, should it take place, would
have no negative effect on the Group's balance sheet and its leverage would
fall to very low levels. The capital which the Group currently has invested in
its Bolton operation would therefore be realised into cash and be available
for re-investment or redeployment elsewhere in the Group.
Rotala Plc 0121 322 2222
John Gunn, Chairman
Simon Dunn, Chief Executive
Kim Taylor, Group Finance Director
Shore Capital 020 7408 4090
Tom Griffiths/James Thomas (Corporate Advisory)
Henry Willcocks (Corporate Broking)
About the business
Rotala provides a range of transport solutions, ranging from local bus
services under contract to local authorities, through to commercial bus
routes. Rotala has operations at Heathrow Airport, in the West Midlands and in
the North West. Operating companies are Diamond Bus Ltd, Diamond Bus (North
West) Ltd, Hallmark Connections Ltd and Preston Bus Ltd.
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