£1.6m windfall for Shropshire Council from sale

Shropshire Council received a cash injection worth more than £1.6 million when its main schools and office supplier was sold off to a private company, it was revealed today.

West Mercia Supplies (WMS), which employs about 100 staff at its base on Oxon Business Park in Shrewsbury, was sold off to The Consortium for Purchasing & Distribution Ltd at the end of April.

At the time, joint owners Shropshire Council did not reveal the value of the deal.

But following a Freedom of Information (FoI) request to the local authority it has now emerged the sale was worth £6.74 million – with Shropshire Council receiving £1.69 million. The rest was shared between joint owners Telford & Wrekin, Herefordshire and Worcestershire councils.

James Walton, financial advice manager, said it would help the council invest in frontline public services. "The proceeds will help benefit and enhance the quality of life for Shropshire residents when money is tight," he added.

But Shropshire councillor Alan Mosley said WHSmith took over the consortium four days after WMS was sold. He claimed a far better deal could have been secured if chiefs had sold afterwards.

Council chiefs maintain that one of the key assurances in the sale was the promise to keep local jobs.

While WMS still held a strong position in the market, it was not considered an essential activity. The councils sold the main catalogue business, together with the trading name. The utilities element is retained by them as West Mercia Energy.