Financial Close reached for Wolverhampton BSF

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Financial Close reached for Wolverhampton BSF

Carillion and Wolverhampton City Council have successfully reached financial close for the Wolverhampton BSF phase 3C PFI of the £270 million Building Schools for the Future programme. This project involves the construction of two new schools, Heath Park and Deansfield, to be ready in time for the school year commencing in September 2015.

The project estimated cost is £42 million (US$69 million).

This milestone effectively represents the end to the UK's Building Schools for the Future programme. Although the Secretary of State for Education announced in 2010 that the entire BSF scheme was to be cancelled, financial close for Wolverhampton BSF phase 3C was possible given the earlier phase 1 had begun two months before the cancellation decision was made, leaving it eligible to continue to financial close.

Carillion is the majority shareholder of the Inspiredspaces Wolverhampton consortium. Aviva provided a term loan and equity bridge loan as part of the financing package.

Wolverhampton City Council will become an equity investor in the PFI project company. The Council intends to invest in the PFI SPV subordinated debt. The estimated level of investment to be made by the Council, at financial close, is of £600,000.

Some pre-work on the sites of the 2 schools has already begun and both are planned to be completed in time for the 2015/16 academic year, apart from the new sports hall at Heath Park which will come a year later. Provision is being made elsewhere for facilities in the interim period.

Councillor Phil Page, Wolverhampton City Council's Cabinet Member for Schools, Skills and Learning, said:

"We are absolutely delighted and proud to have arrived at this point. Reaching financial close for the final 2 schools in the Building Schools for the Future programme is a significant milestone. Both Heath Park and Deansfield will reap the benefits that the other 23 schools included in the programme have enjoyed."

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