Portsmouth City Council's has been unable to find a buyer for its energy company venture Victory Energy and preparations are now being made to close down the company.
In November 2018 a decision was made for the council to dispose of Victory Energy and since then it has followed an extensive process to sell the company.
The council received interest from a number of parties with two parties progressing to an offer.
Of the two offers received one was not acceptable to the council as it still exposed it to substantial further financial risk, the other one was being progressed until recently when the buyer withdrew to pursue an alternative investment.
The council has given notice to the directors of Victory Energy that its financial support for ongoing business operations will cease and will now work with them to support a managed wind down of the company. Victory Energy will shortly be writing to all suppliers and informed them of the position.
The company's nine employees have been given redundancy notices and the consultants supporting the business have also been given their termination notices. The council intends to assist Victory Energy to fund the termination entitlements of the staff and provide them with access to an employee assistance programme.
The council has spent £3.2m setting up Victory Energy, £2.8m of this has already been funded in previous years. Closing the company is not expected to impact on any council services because the money is from separate budgets that aren't used for running our day-to-day public services.
Any financial support for the managed wind down of the company, will come from the council's contingency fund for this year. This means it will not mean the council has to save more money in the future.