London Mayor to buy Tube Lines in £400m deal

Aaron Morby 14 years ago
Share

London Mayor Boris Johnson is on the verge of clinching a deal to bring London Underground contractor Tube Lines into public ownership.

According to a report in the Times today, Transport for London, which is controlled by London’s Mayor, will shortly agree a deal with Tube Lines owners Amey and Bechtel.

The move would send the £30bn Public Private Partnership hurtling into the buffers and mean that Tube Line’s 3,000 staff will be reunited with the 5,000 former Metronet staff, who now work directly for London Underground.

Discussions have been continuing over the past couple of weeks between Tube Lines and TfL but could not be finalised until the election was over.

The deal marks the end a bitter dispute about the scope and cost of the Tube modernisation.

Tube Lines had proposed to charge TfL £4.4 billion for the next phase of maintenance and upgrade work on the three Underground lines. But TfL has argued that the true cost should be only £4 billion.

Last month the projector arbiter, who oversees the London Underground Public-Private-Partnership agreement, told TfL to scale back its ambitious upgrade plans or stump up more cash.

The arbiter’s ruling that Tube Lines could not raise the money itself is understood to have triggered a provision in the complicated PPP contracts that enables the shareholders to sell to TfL and receive compensation.

The Mayor has previously claimed that Ferrovial, Amey’s parent, and Bechtel, stood to get £400m in management fees by 2017.

According to the report, a TfL spokesman said: “TfL continues to work closely with Tube Lines and its shareholders, Amey and Bechtel, to explore all options to address the issues outlined by the PPP Arbiter.

“The parties are yet to reach any conclusion, but we remain committed to working with Tube Lines and its shareholders to identify the best way of providing the vital improvements the Tube needs.”

Latest news

BAM plans wave of job cuts at UK Construction arm

Co-op Live arena plunges Bam Construction to £19.5m first-half loss
8 hours ago

Robot tunnel builder goes into administration

Hypertunnel was hoping to revolutionise how underground structures are built
9 hours ago

“Scrap CITB” say three quarters of construction firms

Payroll giant Hudson Contract calls for CITB to be absorbed into new Skills England training body
8 hours ago

Wates to build £86m Guildford Council housing scheme

40% of the 248 homes will become council homes under partnership deal
9 hours ago

£100m Prestwich Village revival approved

Vinci and Willmott Dixon in chase for Muse-led regeneration scheme
18 hours ago

Carbon negative asphalt trialled on M11

Skanska and Tarmac test CO2 absorbing aggregate material on stretch of Essex motorway
10 hours ago

Father and son sentenced over covid construction loan fraud

Bristol builders given suspended jail sentences over bogus Bounce Back Loans
9 hours ago

Beck Interiors files administration notice

Supply chain has suffered delayed payments from £139m-turnover luxury fit out specialist
1 day ago

Green light for York Central civil service office hub

£60m office project accelerates York Central goods yard redevelopment
1 day ago

Blenheim House Construction enters administration

Administrators looking at options on present projects
2 days ago

Profits rise at Esh Group with more to come

Contractor confident about year ahead as market conditions move in right direction
1 day ago

Piling specialist Van Elle sees housing orders rise 30%

Mark Cutler says firm on course to deliver 10% annual sales growth
1 day ago

HS2 to spend £100m shutting sites where work never started

Remediation of sites no longer needed for cancelled Phase 2 will take three years
2 days ago

Willmott Dixon wins £61m deal for new Army dog unit

Contractor to revamp Kendrew Barracks in Rutland
1 day ago

Stockport advances 4,000-home Town Centre East plan

Council seeks consultants to steer plan for 280-acre area in the city
1 day ago

ISG sale imminent as buyers set-up UK holding company

South African nutrition entrepreneur and Australian partner primed to take over
2 days ago

CR Construction wins £210m Manchester towers

Construction to start next year on four blocks ranging from nine to 34-storeys
2 days ago

Southern Housing to rationalise supply chain following merger

Firms put on alert for £1.7bn construction framework renewal
2 days ago

Decision delayed on 52-storey Isle of Dogs tower

Hong Kong developer plans 460 flats block next to Millwall Inner Dock
2 days ago

Go-ahead for £850m North London estate rebuild

Flagship Edmonton housing estate redevelopment will deliver 2,000 new homes
2 days ago

Mace lands £184m Oxford Science Park contract

Contractor to build trio of laboratory and office buildings
3 days ago

Worker paralysed in 30ft fall during electricity pylon demolition

Specialist firm fined £240,000 after court hears linesman attached lanyard to a loosened steel section
2 days ago

Sir Robert McAlpine clinches £4bn Somerset gigafactory

2.6m sq ft car battery plant will require over 2,000 workers at peak construction
3 days ago

House builder Hill Group tops £1bn turnover

Group's controlled development pipeline stands at £10bn
3 days ago

Higgins wins 360 new homes job in south London

Firm will now work up planning for phase 2 of Brixton housing project
3 days ago

Kier starts £48m Ealing high school job

Northolt High School to be rebuilt for 1,130 pupils
3 days ago

Plans in for £64m Suffolk A12 upgrade

Work to start next summer on dualling and junction upgrades
3 days ago

Man suffers multiple fractures in HS2 accident

Engineering firm fined after fall leaves worker in hospital for two months
3 days ago

Go-ahead for Milton Keynes’ largest private rental project

Platform_ to build 20-storey scheme of 335 flat next to train station
6 days ago

A2Dominion reins in new-build and cuts development team

Housing association to stop private new build sales in big strategy switch
6 days ago

Contractor services