Ambac Financial Group, Inc. (NYSE: ABK) (“Ambac”) said today that Ambac Assurance UK Limited recently provided triple-A credit enhancement to two major U.K. hospital financings completed as part of the British government’s ongoing Private Finance Initiative (“PFI”) investment in the provision of health care services. The separate hospital schemes were jointly procured by different public sector NHS Trusts under the title of the Northern Batch Hospitals Project. Each is separate to the other. The winning consortium was a joint venture between Balfour Beatty Infrastructure Investments Limited and HSBC Infrastructure Fund Management Limited (collectively “Consort Healthcare”). Both are highly experienced with projects of this nature.
Consort Healthcare will design, build and finance the new hospital facilities, and will provide non-clinical and maintenance services post-construction under two different concession agreements. There are separate contracts with Salford Royal NHS Foundation Trust and Tameside and Glossop Acute Services NHS Trust, both running for 35 years.
The two bond issues by Consort Healthcare in September 2007 were for £122 million (Salford Hospital) and £78m (Tameside Hospital). Both are amortizing index-linked bonds. Salford and Tameside hospitals are situated close to each other in the Greater Manchester area in the northwest of England.
“These bonds were issued in the UK market in the middle of the credit crunch and still added value to the hospital Trusts and to Consort. These major deals are evidence of Ambac’s continued leadership in providing credit enhancement for PFI projects in the U.K.,” said Ian Dixon, Managing Director of Ambac’s European Infrastructure team. “Whilst funding spreads were wider than previous issues, Ambac was still able to add significant value against alternative LIBOR funding options.” Ambac was awarded the mandate for this transaction after winning a post-preferred bidder funding competition, one of the first in the sector.
Ambac Financial Group, Inc., headquartered in New York City, is a holding company whose affiliates provide financial guarantees and financial services to clients in both the public and private sectors around the world. Ambac’s principal operating subsidiary, Ambac Assurance Corporation, a leading guarantor of public finance and structured finance obligations, has earned triple-A ratings, the highest ratings available from Moody’s Investors Service, Inc., Standard & Poor’s Ratings Services and Fitch, Inc. Ambac Financial Group, Inc. common stock is listed on the New York Stock Exchange (ticker symbol ABK).
Investor/Media Contact:
Ambac Financial Group, Inc.
Peter R. Poillon, 212-208-3333
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Web site: www.ambac.com