Bernard Ginns: 'Must try harder' is verdict on Business Link company

The regional development agency signed up the company to launch the service in April 2008 on a three-year contract, with an option to extend by two years.

The initial contact runs out on March 31 next year and instead of extending by two years, the RDA has decided to grant a one-year extension, subject to government approval.

Regular readers of the Yorkshire Post will know that Business Link has experienced some problems since the launch two years ago, including concerns over its procurement process, a 1.4m misfiring computer system, fluctuating customer satisfaction levels, recruitment problems and changes to its senior management team.

Simon Hill, the executive director of business at Yorkshire Forward, confirmed the extension. He told me: "The company had an optional extension of two years. We took the decision to do it for one year. It was a clear message that they were good, but not yet good enough. That will focus their minds."

It certainly should. Y&H IDB is a joint venture between recruitment firm Reed in Partnership and Exemplas Holdings, the trading arm of the University of Hertfordshire.

It made a pre-tax profit of 833,952 on a turnover of 33,387,910.

In terms of national performance, Business Link Yorkshire scores highly – in the top one or two out of nine – for the three measures of numbers of businesses contacted, number of businesses receiving intensive help and customer satisfaction, said Mr Hill yesterday.

But, he added, this is not good enough. "Our expectations in the region are higher. We want to push them to be even better."

The company will have to reverse the trend seen in customer satisfaction levels. According to Mr Hill, Business Link Yorkshire's rating – assessed by an independent body – fell from 93 per cent to 89 per cent.

He was careful to praise staff at the organisation, who might be feeling a bit demoralised after the internal and external problems of recent months, describing them as "hard-working public servants".

A lot will rest on the two new recruits to the senior management team, Kate McIntyre and Paul Stevenson, who between them bring top level experience of running call centres and multi-media marketing experience.

Due to the size of the Business Link contract – it is Yorkshire Forward's largest – the government has final sign-off on the one-year extension. It will be interesting to see what the Treasury decides to do; 35m is a lot of money after all.

I report on today's front page about the impending deal at Andrew Page Ltd, the Leeds-based distributor of motor vehicle parts. The company is a great example of a well-run family-owned Yorkshire business, the likes of which this region can be justifiably proud.

Phoenix Equity Partners is becoming majority shareholder, with management and Andrew Page taking stakes in the new holding company. Mr Page, whose father helped found the business just after the Second World War, will invest in the company to help its continued success. He was keen to emphasise it would be "business as usual" for Andrew Page and its 1,100 employees.

According to KPMG's Christian Mayo, who advised Mr Page and the management team, the transaction, which values the business at 100m, is a "fillip for the regional market".

"It's great to have played a role in a process which demonstrates that a deal involving a business of this size and calibre can indeed be done," he said.

"Although we are still in quarter one. I expect this management buyout will prove to be one of the largest Yorkshire deals of 2010 and will kick off a steady stream of private equity transactions as a result of both pent-up demand after last year's debt drought and some form of mergers and acquisitions revival."

Private equity is also likely to play a role in the Sheffield Forgemasters deal, though Business Secretary Lord Mandelson chose not to mention this during his visit to the Steel City last week. I wonder why?

As I understand it, talks are continuing with a number of equity providers about completing the finance package which so far includes a soft government loan, some forward orders from a big customer and support from Lloyds Banking Group.

As we say in the newspaper game, watch this space.