Addleshaws puts MoD’s £3bn PPP deal with Holdfast to bed
Addleshaw Goddard has advised the Ministry of Defence (MoD) on a £3bn PPP deal with the Holdfast consortium to provide training and accommodation for the Royal School of Military Engineering (RSME) until 2038.
RSME ;is ;a ;30-year project covering training, construction of new buildings and refurbishment of existing accommodation, as well as the relocation of the Defence Explosive Ordnance Disposal School (DEODS) and the National Search Centre (NSC) from Medway, Kent, to Bicester in Oxfordshire.
Addleshaws’ lead projects partner Jacqui Langley-White was instructed back in 1998, but the deal was held up several times as a result of the complexity of the project, which covers 13 sites, political sensitivities and affordability issues.
“Outsourcing training, even quite low-key training, isn’t seen as politically acceptable to everyone,” said Langley-White. “If you try to make it a pure PFI, the risk you are passing over to the private sector has a high price tag attached to it. We ended up with a PPP project and the MoD paid for the construction costs. [This will] no doubt result in discussion within the PFI/PPP market about the use of different models in delivering long-term partnership-based contracts.”
Langley-White was supported by a team of 20 lawyers, with projects senior associates Elizabeth Vago and Stephen Tainsh advising on services-related issues and financial security respectively.
The Holdfast consortium is made up of Babcock and Carillion. It was advised by projects partner Frank Dufficy and senior associates Rob Gray and James Thomas of CMS Cameron McKenna. Carillion was advised by Pinsent Masons and its in-house team, while Babcock was advised ;by ;Camerons behind a Chinese wall.
The deal has a £300m capital spend and a £2.7bn revenue spend. Trade training is provided by subcontractors Mid-Kent College, which is advised by Hammonds. ;ESS ;UK Defence and TQ Education & ;Training ;were ;also subcontracted.
