Deals Case Studies: Infrastructure Ontario

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Infrastructure Ontario

executed a PPP for the $511 million North Bay Regional Health Centre with a group led by

Plenary Health

advisor to Infrastructure Ontario
PricewaterhouseCoopers

Issue

Infrastructure Ontario (IO) is a Crown corporation responsible for the procurement of major infrastructure projects in Ontario using the Alternative Financing and Procurement ("AFP") model, a variation of public-private partnership ("PPP") models used globally.

IO needed a process and transaction advisor for the North Bay Regional Health Centre, a new 700,000 square foot facility that includes 275 acute care beds and 113 mental health beds. The project was particularly important because it was the first hospital delivered by IO under the AFP program in Ontario. IO needed an experienced advisor to help them structure the transaction, procurement process, and evaluation methodologies in order to create a template for future projects.

PwC approach

PwC leveraged its global experience and solid knowledge of the Canadian leading investors and lenders to design a deal that both satisfied the client's requirements and was marketable and financeable.

The services we provided included advising on the project agreement, structuring a payment mechanism that met the hospital's objectives and was acceptable to lenders, developing the procurement documents, and designing the evaluation process and implementation, including bid evaluation training and advice.

Our team also advised on the value for money ("VfM") analysis, prepared the Reference Bid, participated in RFQ and RFP bid evaluation and advised on the commercial structure of the concession.

Client benefits

The deal closed in February 2007 and the hospital is now under construction. PwC assisted with transaction definition, confirmation and articulation of detailed transaction scope, as well as allocation of risk and responsibility between the hospital and the consortium partner. The procurement process was highly competitive and allowed IO and the hospital to take full advantage of the benefits of the AFP model. The work done by PwC became part of Infrastructure Ontario's agreements template and standard process, setting the stage for future projects.

PwC Specialist

Shamshad Madhok (CA), managing director for the Infrastructure and Project Finance group in Ontario, was the project lead. Sham has more than 10 years of global experience in project finance and has advised on 18 transactions with a combined capital value of $3 billion. Sham led on all aspects of the transaction from inception through to financial close.