Secretive waste firm bailout labelled a scandal...

[dutchman]

Conservative Councillor Peter Male hit out at a decision to bail out a struggling waste firm owned by the council and the decision to keep the figures from the public



A £7.5m bailout loan for a waste collection firm a council bought to make a profit has led to accusations of "desperate measures" involving public money.

Tom White Waste (TWW) was purchased by Coventry City Council in 2020 for £14.9m as part of a strategy of investing in commercial businesses.

A council report, meant to be kept from the public but leaked to the BBC, shows the waste company's mortgage lender has called in its debt due to ailing financial performance, and the Labour-controlled council stepping in to avoid the business going into administration.

A spokesperson for the council said commercial investment had helped to keep front-line services running.

But speaking during a council meeting on Tuesday, Peter Male, Conservative shadow cabinet member for finance, said the bailout was "a desperate measure to avert the loss of significant millions of public money", and suggested attempts to keep the financial details of the bailout secret were "a scandal".

The private council report showed the waste management company, which employs 150 people, was generating £1.5m cash a year as of 2022/23 compared to £2m when the company was first bought. That was despite the company experiencing growth in the top line revenue, from the £14.5m on acquisition to £20m today.

The report blamed the financial performance on lower profit margins on new contracts as old contracts expired. But it said performance had recently improved after the company's managing director was replaced in September 2024.

The deal will see the council take on the company's assets and lease them back to the business at £600,000 a year for 25 years – ultimately generating a profit for taxpayers if the business becomes as profitable as the council forecasts.

During Tuesday's meeting, Labour councillor Pervez Akhtar said: "In simple terms, the council is buying an income-producing asset at market value. The rent paid by TWW will cover the borrowing costs and produce a surplus."

The latest bailout follows a £22.7m loan taken on by the council to allow Tom White Waste to upgrade recycling facilities in 2022. The local authority said at the time that move would ultimately help to cut costs.

[rebbonk]

...generating a profit for taxpayers if the business becomes as profitable as the council forecasts.

The council hasn't exactly got a good record here, has it?

Maybe the council should do what it's supposed to do and not get involved in speculative commerce, which it is ill-equipped to do.

[dutchman]

Council-owned Tom White Waste drops in valuation by almost £5m in one year



Council-owned Tom White Waste (TWW) has dropped in valuation by almost £5m in one year. Figures taken from the council's 2024-25 statement of accounts show the company's valuation dropped from £6.6m in 2024 to £1.9m in 2025.

The statement of accounts reads: "The Council purchased a 100% shareholding in TWW in March 2020. The company provides a commercial waste collection service in the local area.

"The purpose of the acquisition is to complement the Council's existing in-house waste services. A valuation exercise undertaken jointly with Azets in 2024 valued the Council’s shareholding in TWW at £6.6m.

"A subsequent valuation in 2025 undertaken jointly with Azets resulted in a reduced valuation of £1.9m. TWW had lower than expected turnover from contracts alongside increased disposal costs."

The council bought out TWW for almost £15m five years ago. According to reports from the BBC earlier in the year, leaked documents show the council has already had to step in to stop the company going into administration with a £7m bailout when its mortgage lender called in its debt over concerns about TWW's financial performance.

Asked to comment, a spokesman for the council said: "Our commercial investments are made as part of a long-term strategy and in total these generated dividends of almost £16 million in 2024/25. It was also the performance of our diverse portfolio performance that helped turn around a predicted £7m overspend in December 2024 into a £1.8m underspend.

"This is down to strong dividend performance from Birmingham Airport and Coventry and Solihull Waste Disposal Company which are long established investments. This money can be invested back into front line services.

"We also have other commercial ventures including Coombe Abbey Park Hotel and Tom White Waste that are part of a longer-term investment strategy, and that provide wider benefits to the city including local jobs, and services to local businesses. Both are generating significant income, and it is expected that their parent company will also return a dividend to the Council in 2025/26.

"There are always fluctuations in what the market estimates businesses to be worth and we believe that the situation will strengthen. The valuation is really just a paper valuation which only matters if we planned to sell – which we don’t."