QinetiQ (Hansard, 24 July 2002)

§ The Parliamentary Under-Secretary of State, Ministry of Defence (Lord Bach)

On 1 July 2001, the Defence Evaluation and Research Agency was successfully divided into QinetiQ plc, currently a wholly government-owned company, and the Defence Science and Technology Laboratory, which remains part of the Ministry of Defence.

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On 6 March 2002, my honourable friend the Parliamentary Under-Secretary of State for Defence (Dr Moonie) announced in another place that we had decided to sell a substantial stake in QinetiQ to a strategic partner who would help to develop the company in preparation for a future flotation on the stockmarket. Our decision followed a detailed analysis of market conditions, which led us to conclude that this approach offered best value for the taxpayer, and would meet our objectives for a successful public/private partnership.

Immediately following this announcement we initiated an open competition and carried out a pre-qualification process to identify potential partners. Almost 40 expressions of interest were received, and at the end of April 2002 12 organisations were selected to receive an information memorandum describing the company. Following the evaluation in late May 2002 of indicative offers from bidders, several companies were then provided with access to more detailed information on QinetiQ and invited to submit final binding bids. In order to maximise competition we do not propose to reveal how many companies were selected to participate in this stage, or their identities.

We have received a number of responses within the past few days from the shortlisted bidders, and these are now being comprehensively evaluated by officials and specialist advisors. The results of the selection process are not yet available but we remain on track to identify the preferred bidder within the next few weeks, and complete the initial sale later this year.