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Design consultancy sold by council

MEDIA RELEASE
7 December 2004

Design consultancy sold by council

Auckland City has agreed to sell its design consultancy City Design Ltd, to consulting firm GHD Pty Ltd.

City Design provides land, road, water, environment, building, and traffic design and support services to the public and private sectors.

In August this year the council announced the decision to sell City Design, to enable the company to better compete in the commercial market at local and national levels.

The sale has been concluded following a contestable sale process that was managed by PricewaterhouseCoopers. It included consultation with City Design management and staff as well as Auckland City.

City Design’s chief executive officer, Barry Potter, says the outcome is regarded as being very beneficial for City Design, Auckland City and GHD.

“GHD has an excellent international reputation and a strong presence in New Zealand,” he says. “City Design will be in a much stronger position to increase its client base as a result of the sale, by competing for work independent of the council and being able to respond better to the market.

“The sale not only presents an opportunity for GHD to strengthen its position in New Zealand as a leading supplier of professional engineering and architectural services, but also presents greater career opportunities for City Design employees.”

City Design has 90 staff and offices in Auckland, Lower Hutt and Napier. All staff will transfer to GHD as part of the conditions of sale.
“Career opportunities and new challenges for current employees was crucial to the sale,” says Mr Potter. “Both the council and GHD know the value of the people they are employing.”

Staff were aware of the pending sale, and have been personally told about the consultancy’s new owners this afternoon. The City Design offices will remain in their current locations at present.

The sale includes a partnering agreement that will see a continuity of work from Auckland City, consistent with the council’s preferred supplier policy.

Note to editor:
City Design is a Council Controlled Trading Organisation – formerly a Local Authority Trading Enterprise (LATE) – and was established in 2000.

Questions and answers about the sale of City Design Ltd to GHD Pty Ltd

Why has Auckland City sold City Design?
- The council voted to sell City Design in August 2004, to enable the council’s design consultancy to better compete in its professional engineering, architecture and management services market, independent of Auckland City.
- The relationship between Auckland City and City Design was reassessed earlier this year. City Design has a national and international growth strategy, and currently has offices in Auckland, Lower Hutt and Napier. As part of an international consultancy firm City Design will be able to provide its services to new markets while enhancing the services it can provide to its local clients.

Who has purchased City Design?
- Auckland City has sold City Design to GHD, an international professional services company, which provides management, engineering, environmental, planning and architectural services.
- GHD has a network of more than 60 offices and 2,500 employees in Australia, the Middle East, Asia, New Zealand and the Americas. It ranks in the world's top 50 engineering and environmental firms.

How much is the sale worth to Auckland City?
- Auckland City is not able to disclose the details of the sale price at this time due to confidentiality agreements.

What will be done with the proceeds of the sale and what will happen to assets currently owned by City Design?
- All City Design assets will transfer to GHD other than intellectual property owned by Auckland City. The proceeds will be added to the council’s budget for funding capital projects requiring urgent attention in the city.

What happens to staff as a result of the sale? Will there be any redundancies?
- All existing City Design staff will transfer to GHD as a condition of sale.

When does the sale take effect?
- Settlement takes place on Friday 10 December 2004.

ENDS

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