Date set for new body to take over Arch
A DATE has been set for the transition from Northumberland County Council’s troubled development company Arch to its successor, Advance Northumberland.
In June, the local authority’s cabinet approved the closure of Arch Corporate Holdings and the establishment of the replacement holding company, which “will not take unnecessary risks with taxpayers’ money”.
Now, a report to councillors has set out the steps required to transfer the assets, liabilities and trading operations of Arch to Advance Northumberland, which is scheduled to take place on Tuesday, November 13.
“The steps required are complex in order to comply with current tax legislation and involve the transfer of significant sums of money that will be reimbursed by a final dividend payment,” the report says.
The process, which the cabinet is being asked to approve next Tuesday, will see the council buy £3.3m of additional shares in Advance Northumberland, which will be used to buy Arch’s subsidiary companies.
The council will also buy a further £0.9m of additional Advance shares to enable the new company to buy Arch’s trade and assets “at a nominal value”.
Finally, the £4.2m paid out will be returned to Northumberland County Council via a dividend payment upon the dissolution of Arch (Corporate Holdings) Ltd. The amounts involved – £3.3m and £0.9m – “are the best estimates based on the current trading position”, so approval is also sought for any variation to be agreed by the chief executive and finance director in consultation with Coun Nick Oliver, cabinet member for corporate services.
Advance Northumberland will be a limited company with the council as sole shareholder, like Arch, and staff and assets are set to transfer to the new company. There will be no change to rents or agreements for tenants of Arch homes.
In June, it was reported that it will focus all its efforts within the county with projects including developing investment zones in the south of the county, including Ashington, Blyth, Cramlington and Morpeth.