Carillion beats Skanska to £374m Southmead PFI hospital

Carillion has beaten Skanska to become preferred bidder on the privately financed £374m Southmead Hospital scheme in Bristol.

Carillion will fund, build and maintain a new state-of-the-art 800-bed hospital. The acute hospital will consist of five inter-related zones for inpatients, emergency services, ambulatory care, clinical services and a fifth area for support services. The 800 beds in the new hospital will be provided in units of 32 beds each. These units can be further divided into multiples of eight. Around 75% of inpatient beds will be in single rooms.

The preferred bidder was due to be chosen in the summer last year. However concerns over the new PFI accounting rules, which will see most PFI schemes come onto public sector books, and the banking crisis, resulted in the scheme being delayed. The EIB came in at the 11th hour with a pledge to provide up to 50% of the senior debt for the scheme.

The news will come as a bitter blow to Skanska. However the possibility of it claiming its bid costs back will offer a degree of comfort. The Southmead scheme is trialling a new development, backed by the Treasury, which allows the losing bidder to claim back a percentage of its bid costs. The trial was prompted by the rising cost of bidding for PFI deals following the introduction of the Competitive Dialogue Procedure which requires both shortlisted bidders to work up much more detailed bids before the selection of a preferred bidder.

Both firms were unavailable for comment as CJ went to press.

A spokeswoman for the North Bristol NHS Trust declined to comment on the decision until a formal announcement later this week.