17th Aug 2015 06:43
LONDON (Alliance News) - Carillion PLC Monday said a contract which will lead to the company upgrading facilities at eight schools in the English Midlands has reached financial closure.
Through the company's joint venture vehicle, PSBP Midlands Ltd, Carillion said the Midlands Priority School Building Programme has reached financial close. The programme is a 25-year private finance concession contract using the UK government's Private Finance 2 model, it said in a statement.
The Private Finance 2 model sets out how the government invests and manages its public private partnerships, meaning the contract will fall under the company's Public Private Partnerships portfolio.
"We are delighted to have achieved financial close on this important schools programme. Carillion is a market leader in the education sector, having delivered some 150 schools over recent years, many of which were Public Private Partnership projects," said Chief Executive Richard Howson.
Under the programme, Carillion will improve education facilities at eight schools by replacing existing substandard buildings.
"The new schools will be constructed over a two-year period to the highest standards of sustainability and provide excellent facilities to support teaching and learning in addition to providing excellent new facilities for the local community," said the company.
Carillion expects to invest GBP5.5 million of equity into the project, and will spend a further GBP138.0 million in capital costs to build the facilities. The company said it will deliver the facilities management and life-cycle maintenance services for the facilities, which will generate GBP49.0 million in revenue over the 25-year life of the contract.
The schools to benefit from the programme are located in Derbyshire, Birmingham, Coventry, Sandwell, Warwickshire and Nottingham.
By Joshua Warner; [email protected]; @JoshAlliance
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