Barclays share price: Bank ditches ‘Boris bike’ sponsorship

on Dec 11, 2013
Updated: Oct 21, 2019
Listen, Wednesday, December 11: Barclays Plc (LON:BARC) is preparing to drop its sponsorship of Boris Johnson’s flagship bicycle hire scheme, the Guardian has reported. While the lender said that the withdrawal from the Boris bikes scheme was a result of a strategic review of all its sponsorship deals, the decision also comes amid fears over cycling safety in the city. Barclays’ share price has shed about 0.4 percent in morning trading in London today.

**Barclays drops sponsorship for Boris bikes**
Barclays has confirmed plans to drop its sponsorship of ‘Boris Bikes’ in 2015, three years earlier than previously expected, delivering only half of the £50 million the London mayor had said the lender would pay.
The Guardian yesterday reported that Barclays executives were understood to have met the mayor’s Cycling Commissioner Andrew Gilligan last month to inform him that the lender would be withdrawing its backing for the flagship cycle hire scheme which makes around 8,000 bikes available from 570 docking stations.

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Barclays’ logo has covered the ‘Boris bikes’ since the scheme was launched by Johnson in 2010. The original agreement, under which the lender would pay £25 million for branding rights to August 2015, was extended in 2011 to 2018 for a further £25 million.
Barclays’ decision comes in the wake of increased public concern about cycle safety in London, following a spate in cycling deaths. The bank however noted that it had made a commercial decision to withdraw from the deal after conducting a strategic review of all its sponsorship deals. The Independent quoted a Barclays spokesman as saying that the lender’s decision had nothing to do with recent tragedies.

In a statement, Transport for London’s (TfL) director of commercial development Graeme Craig noted that the bank had “not pulled out of the Cycle Hire sponsorship deal”.

“After the current sponsorship deal with Barclays ends – in two years’ time – the cycle sponsorship portfolio will fundamentally change.”
**Deal criticism**
Johnson’s deal with Barclays drew criticism from the London Assembly over whether the lender had paid enough. In addition, the mayor has been criticised over his decision to extend the sponsorship agreement without putting the deal out to a new competitive tender process.

The BBC quoted Caroline Pidgeon, leader of the Liberal Democrat London Assembly Group, as saying: “Barclays have received immense benefits from the publicity given to the cycle hire scheme in its early years, but now that its performance is looking shaky they appear to be bailing out.” Figures from TfL show that 514,146 journeys were made in November this year, down from 726,893 journeys in November last year.
“Fundamental questions have to be asked as to how such a one-sided deal was ever struck between Transport for London and Barclays,” Pidgeon added.
**As of 10:24 UTC, buy Barclays shares at 263.35p.**
**As of 10:24 UTC, sell Barclays shares at 263.25p.**

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