MoD bags millions from sale of executive agency

Executive agency responsible for the “land arm” of the Ministry of Defence (MoD) has been sold for £140m, it was announced today

Jonathan Slater Photo Baldo Sciacca

By Sarah.Aston

17 Dec 2014

The Defence Support Group – which is responsible for maintaining and repairing key military equipment as well as managing the storage of the land vehicle fleet – has been sold off by the MoD for £140m.

The executive agency and trading fund will be taken over by the UK multinational Babcock International as part of a 10-year contract, the MoD said.

The department told CSW that they did not anticipate the sale of the agency would impact staff.

Defence equipment minister Philip Dunne said: “I am delighted with the successful outcome of this transaction.

“Babcock will provide market-leading engineering and fleet management expertise to optimise vehicle availability to the Army at better value for the taxpayer.

“The £140m proceeds from the sale and the significant savings over the life of the contract represent outstanding value for money for the tax payer and will allow us to continue to focus our resources on the front line.”

The contract is due to be completed by 31 March 2015 and service provision is expected to start on 1 April 2015. 

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