Carillion wins hospital bid

3rd Aug 2011 07:45

A Carillion joint venture, Hospital Infrastructure Partners, has been selected as the preferred bidder to finance, design, build and provide facilities management and life-cycle maintenance services for the new replacement Oakville Hospital in Ontario. The 30-year contract, which is the support services company's sixth public-private partnership hospital in Canada, is worth some £1.3bn at 2011 prices and £1.7bn after taking into account indexation for anticipated price inflation over the contract period. The project will be delivered using the Alternative Financing and Procurement (AFP) model, which is similar to the UK's Public Private Partnership model. Carillion will invest some £28m of equity in the project, giving the company a 40% equity share in the joint venture, with its revenue share expected to be around £500m at 2011 prices. In addition, Carillion will also be a member of the joint venture that will carry out the construction work and provide facilities management and life-cycle maintenance services over the 30-year concession period, which together are expected to generate some £390m of revenue for Carillion at 2011 prices.Carillion chief executive, John McDonough, said: "We are delighted to have achieved financial close on this important new hospital project in less than two months since our appointment as preferred bidder. "Securing this contract further reinforces Carillion's position as a leader in the PPP market, particularly in the health sector. We look forward to working with Infrastructure Ontario and Halton Healthcare Services to deliver this state of the art hospital, for which we will also provide facilities management and life-cycle maintenance services." NR