UK names frontrunner for £5bn defence PFI

The Soteria consortium - including Royal Bank of Scotland, French defence contractor Thales and helicopter specialist CHC – has been selected as the preferred bidder for the UK’s £5bn Search and Rescue Helicopter PFI. The contract will last for 25 years with the private partner to start providing services to the Ministry of Defence in 2012.

Soteria has been named preferred bidder for one of the UK’s largest project finance initiative (PFI) deals – the £5 billion (€5.7 billion; $7.9 billion) Search and Rescue Helicopter programme.

The consortium includes Royal Bank of Scotland, French defence contractor Thales and helicopter specialist CHC, which already does search and rescue work with four UK bases. The 25-year contract – part of the government’s PFI programme, a procurement scheme with private sector participation – will require Soteria to start providing search and rescue services in 2012.

Soteria beat competition from the AirKnight consortium, comprising Britain’s VT Group, US defence giant Lockheed Martin and British International Helicopters. The loss did not go down well with VT Group’s chief executive, Paul Lester, who told London newspaper the Telegraph: “We are surprised and disappointed that the Government wants to place such an important and sensitive contract with a helicopter firm owned by US venture capital interests, particularly as CHC are selling a similar search and rescue business in Australia.”

CHC is owned by an affiliate of First Reserve.

The winner plans to use the S92 helicopter, built by US firm Sikorsky, to provide its search and rescue services while AirKnight was planning on using the Eurocopter EC225 helicopter, made by EADS, headquartered in Germany.

The winning consortium shares its name with the Greek goddess Soteria, the goddess of safety, deliverance and preservation from harm.