New Zealand locks down prison PPP contract

The SecureFuture consortium – which counts John Laing, InfraRed and the Accident Compensation Corporation as equity partners – has reached financial close on an A$840m contract to build and run a 960-bed male prison in Wiri. ANZ, BOS International and Bank of New Zealand are providing debt.

New Zealand’s Department of Corrections has reached financial close with the SecureFuture consortium on a public-private partnership (PPP) to build and run a new, 960-bed male prison at Wiri, South Auckland, the sponsors announced today.

The A$840 million (€683 million; $873 million) deal has reached financial close backed by an unspecified amount of debt provided by ANZ National Bank, BOS International and Bank of New Zealand. 

SecureFuture is made up of Fletcher Construction – which will design and build the prison – Serco –which will operate it – Spotless Facility Services – responsible for maintenance – and equity partners John Laing, InfraRed Capital Partners and The Accident Compensation Corporation. Macquarie Capital advised the consortium.

The team said the PPP contract will allow the government to save 17 percent when compared with delivering the prison through traditional procurement. The facility is expected to open in 2015, with the concession contract lasting for 25 years.

The Wiri prison PPP was first touted in 2010 by New Zealand Infrastructure Minister Bill English and Justice Minister Judith Collins. SecureFuture was named preferred bidder for the contract in March.