Skanska wins EUR 246m construction contract in UK

Swedish-based developer Skanska has been awarded a GBP 174 mln (EUR 246 mln) contract to redevelop Manor Hospital in Walsall, a large industrial town in the British West Midlands. Skanska itself will invest a total GBP 8.2 mln in the 33-year PFI scheme, giving it a 50% interest in the project company which will be co-owned with Innisfree.

Under the deal, Skanska will design, build, finance and operate the hospital for the Walsall Hospitals NHS Trust. It has received a facilities management contract valued at around GBP 2.3 mln per year for the entire 33-year period. The signed financial close provides for a net cashflow for Skanska of about SEK 345 mln (EUR 37 mln) in the fourth quarter.

The redevelopment of Manor Hospital will include 40,000 m² of new accommodation, including a modular ward block containing 136 beds. This unit will complement the existing facilities, some of which are to be refurbished, to provide a total of 558 inpatient beds at completion of the scheme. Preparatory works have been completed and main construction will begin this month with full completion of the scheme due in the summer of 2011.

Skanska is a leading Private Public Partnership (PPP) company in the UK. Its largest project to date is the development of the Barts and The London hospitals, for which the construction contract amounted to some GBP 1 bn.