Decision details

Purpose of Report: To outline the proposals to establish a Limited Company owned by the thirteen Founder Members of YPO (Yorkshire Purchasing Organisation) and managed by the current Y.P.O. Management Team.
Members are asked to approve the formation of the Limited Company and agree the management arrangements.

This report has been slipped to the April 2014 meeting in order to allow additional time for examination of the arrangements.

Resolved:  That Cabinet agree to:

i)             Note the preparation of the Business Case by Yorkshire Purchasing Organisation Officers in support of the proposed exercise of the power to trade and approve the final Business Case set out at annex 1 (exempt) of the report.

ii)       The formation of the trading company limited by shares wholly owned by the Founder Members of YPO (to be known as YPO Procurement Holdings Limited) to act as a holding company for a range of special purpose vehicles in order to protect the business of the YPO joint committee.

iii)     The Council becoming a shareholder of the company limited by shares under the name of YPO Procurement Holdings Limited which may trade in accordance with section 95 of the Local Government Act 2003 and the Local Government (Best Value Authorities) (Power to Trade) (England) Order 2009 and or Section 4 of the Localism Act 2011.

iv)     Recommend Council to make appointments as its director and alternate director on the Company Board.

v)       Note that the Chairman of the Board of the company will be as set out in the Shareholder agreement.

vi)     Authorise  the Director of Customer and Business Support Services to exercise the Council’s powers of shareholder at general meetings in the company.

vii)   The governance and funding arrangements for the company as set out in the report.

viii)   Delegate authority to the Director of Customer and Business Support Services, in consultation with the Assistant Director of Governance and ICT, to finalise the detailed arrangements for the formation of the company including relevant financial matters and, governance issues, such as matters to be reserved to the Council as shareholder and to delegate authority to the Assistant Director of Governance and ICT or authorised representatives to enter into all necessary legal agreements or documentation and ancillary to the implementation of the above recommendations in accordance with the following documents substantially in the form set out in the;

·     The Memorandum and Articles of Association of the company – annex 2 of the report (exempt)

·     The Shareholder Agreement - annex 3 of the report (exempt)  

·     The Management Services Agreement – annex 4 of the report (exempt)

Reason:              The business case (as set out at Annex 1) of the report (exempt) is based upon protecting the current business which could be lost if outsourced to private bodies, access to new business to enable continued growth and protection against financial risk, resulting from structural changes in the customer base.