RAC plc wins preferred bidder status for £500m MoD project

Article date: 17 December 2003

RAC plc, the motoring and vehicle services company, announcesthat the Amey Lex Consortium (ALC), a partnership between Amey plc,the support services specialist, and Lex Defence Ltd, RAC plc'sdefence fleet management and logistics subsidiary, has beenselected as preferred bidder for the Ministry of Defence C VehicleCapability Private Finance Initiative (PFI) programme. Theprogramme revenue is projected to be worth in excess of £500million over the 15 year contract period.

The C Vehicle programme will provide all construction vehicles,plant and equipment that is typically used by the military forengineering projects and equipment/material handling to the BritishArmed Forces. This group of vehicles include cranes, excavators,bulldozers, and mechanical handling equipment, such as forklifttrucks.

The Consortium will deliver an innovative service, rather than aprocurement based solution, building on the extensive service andsupport experience of both partners. ALC will rationalise the MoD'sC Vehicle Fleet from over 3,500 to a size of approximately 2,500vehicles. ALC will then maintain and manage the fleet and provideassociated services, including spares support and inventorymanagement, a comprehensive management information system,equipment documentation and training for operators and instructors.The service is to be provided mainly to the British Army, includingunits supporting the Royal Air Force and the Royal Marines, on aworldwide basis.

Peter Harris, Group Managing Director, responsible for LexDefence, stated: "We are extremely pleased to have the opportunityto further build on our growing partnership with the MoD. Oursuccess with Amey in this consortium reflects the synergy of ourservice offerings and our ability to provide significantoperational capability for the benefit of our MoD customers."

Mel Ewell, Chief Executive Officer of Amey, said: "We aredelighted that the MoD has selected us as the Preferred Bidder forthis ground breaking fleet contract. This reflects on the strengthand innovation of the services offered in partnership with LexDefence, as well as the calibre of our professional team and theirunderstanding of the MoD's objectives."

Lord Bach, Minister for Defence Procurement commented "The CVehicle bid is the largest PFI bid involving front line operationalland capability for the British Armed Forces. In order to ensurebest value for money for tax payers, we placed this contract opento competition. ALC, building on the existing strong arrangementswith Amey and Lex Defence, was able to offer a superior solutionthat met our requirements in a cost effective way."


Peter Harris, Group Managing Director, Manufacturer SupportServices, RAC plc. Tel: 01628 843739

Niall Addison, Group Finance and Investor Relations Manager, RACplc. Tel:07764 624701

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