£600m PPP hospital project for Carillion

A joint venture bid from the Hospital Company consortium of Carillion and the Royal Bank of Scotland has finally emerged as preferred bidder for a £600m hospital relocation deal in Oxford that first surfaced seven years ago.

The centrepiece of the public private partnership deal is the construction of specialist surgery facilities, valued at £125m, in a new building on the John Radcliffe Hospital site. This will allow the relocation of facilities at the Radcliffe Infirmary.

The deal, for the Oxford Radcliffe Hospitals NHS Trust, also involves a new Oxford Children's Hospital and a £7m traditional contract to refurbish facilities in part of the existing hospital building owned by Oxford University.

The total value of the project is expected to be worth around £600m over the 30-year concession period. Work on site is expected to start this summer for completion in 2006.

The Carillion jv beat off competition from two remaining rivals to clinch the keenly fought contest - Balfour Beatty and Summit Healthcare, fronted by Sir Robert McAlpine, are the disappointed pair.

Three other bidders - Bovis Lend Lease, Mowlem and Bouygues - were eliminated from the chase early last year.

The original scheme, promoted by two different NHS Trusts - Radcliffe Infirmary and Oxford Radcliffe Hospital - was abandoned in 1996 after all four bidders backed out, complaining about the project's complexity and the high costs of bidding.

The original line-up featured teams led by Alfred McAlpine, Kier, WS Atkins and Schal.