Balfour Beatty, HSBC complete £170m Scottish hospital PPP(3)

The two sponsors are investing a total of £19 million of equity in a deal to build a new wing for the general hospital of the Scottish town of Fife.

Engineering and construction firm Balfour Beatty has added to its portfolio of healthcare PPP projects in the UK by achieving financial close on the £170 million (€190 million; $252 million) Fife General Hospital and Maternity Services public private partnership (PPP) in Scotland.

Under the deal, Balfour Beatty Capital, the firm’s infrastructure investment arm, is investing £9.5 million of equity in the deal. Another £9.5 million of equity comes from HSBC. Total debt arranged for the project is £170 million. The firm declined to disclose the details of its bank lenders.

The capital will be used to complete the construction of a new wing of Fife’s Victoria Hospital in Kirkcaldy, which began in September last year under an Advanced Works Agreement. Balfour Beatty Construction and Haden Young are doing the building work. The project is due to complete in 2011.

The transaction takes the amount of equity Balfour Beatty has invested in UK healthcare PPPs to £116 million.  The portfolio also includes ongoing hospital construction projects in Birmingham, Pinderfields, Salford and Tameside.