However, Carillion’s own equity investment in the project has been reduced to £13m, from a previously expected £16m.
The joint venture, called The Hospital Company (Sandwell) Ltd, is 50% owned by Carillion; Richardsons Capital has 40% and Infrastructure UK 10%. It was selected as the preferred bidder for the project in Aigust 2015 by the Sandwell & West Birmingham Hospitals NHS Trust. [See previous report here.]
Construction will start in early 2016 and completion is scheduled for mid-2018, with the hospital opening in late 2018. Carillion will build it, at an expected capital cost of £297m. It will then deliver hard facilities management and life cycle maintenance that is expected to generate approximately £140m of revenue over the 30-year life of the concession contract.
Carillion chief executive Richard Howson said: "We are delighted to have achieved financial close on this important new hospital. Carillion has delivered over 60 Public Private Partnership projects including more than 20 healthcare projects, making us a global leader in the PPP market. We will use this experience and our commitment to working closely with the Sandwell & West Birmingham Hospitals NHS Trust to deliver a state-of-the-art hospital that will support the Trust in delivering significant improvements in healthcare services for the people of Sandwell and West Birmingham."