ANNOUNCEMENT
THE COVENTRY AND RUGBY
HOSPITAL COMPANY PLC - RNS ANNOUNCEMENT
THE COVENTRY AND RUGBY
HOSPITAL COMPANY PLC (the "Issuer")
£407,239,000
3.246 per cent. Index
Linked guaranteed secured bonds due 30 June 2040 (including
£35,000,000 variation bonds)
(with authority to issue
further bonds)
unconditionally and
irrevocably guaranteed as to scheduled payments of principal and
interest pursuant to a financial guarantee policy
issued by
MBIA ASSURANCE S.A. (succeeded by ASSURED GUARANTY UK LIMITED)
Referral to Adjudication concerning Adjusted Estimated Fair
Value of the Agreement (AEFVA)
In reference to the
Project Agreement between University Hospitals Coventry and
Warwickshire National Health Service Trust, Coventry Primary Care
Trust (succeeded by Coventry and Warwickshire Partnership Trust)
and The Coventry and Rugby Hospital Company Plc, dated 3 December
2002, as amended from time to time and the Collateral Deed between
The Coventry and Rugby Hospital Company Plc, The Coventry and Rugby
Hospital Company (Holdings) Limited, Mourant & Co. Capital
Trustees Limited (succeeded by Apex Corporate Trustees (UK) Ltd)
(As Security Trustee and
Bond Trustee) and MBIA Assurance S.A. (succeeded by Assured
Guaranty UK Limited), dated 3 December 2002. Unless otherwise
defined herein, capitalised terms have the same meaning as given to
them in the Project Agreement, Schedules to the Project Agreement
and Collateral Deed.
As reported in RNS numbers 7541O on 1 February 2023
the Issuer received a termination notice from the Coventry and
Warwickshire Partnership Trust (previously Coventry Primary Care
Trust) (the "Trust"). By this termination notice the Trust stated
that it had terminated the Project Agreement in its entirety as it
applies to the Trust only, pursuant to the terms of the Project
Agreement, and that such termination took effect on 1 February
2023.
It was subsequently announced in RNS 9708S that the
Trust did not elect to retender the Coventry Primary Care Trust
Project Operations and therefore the no retendering procedure under
the Project Agreement would be followed. Consequently, the
Issuer and the Trust would seek to agree the Estimated Fair Value
of the Project Agreement (as it relates to the Trust only).
In RNS 7979W it was stated that in accordance with
the principles set out in the Project Agreement and using all
information available to it, the Issuer calculated the Estimated
Fair Value of the Agreement as at 1 February 2023 to be
£85,553,937. This was communicated to the Trust on 3 March
2023. The Estimated Fair Value of the Agreement will be
subject to tax equalisation if the Issuer attracts a tax liability
as a result of the payment, whereby the amount of compensation is
increased to ensure the Issuer is in the same position as it would
have been in had it not been for the relevant tax liability.
In addition, interest will be payable on the compensation
payment in accordance with the terms of the Project Agreement.
The Trust responded on 18 April 2023, stating that in
its assessment the Estimated Fair Value of the Agreement is
negative £39,749,282.
Subsequent exchanges between the Issuer and the Trust
in the intervening period have not resulted in agreement.
On 30th January 2024 the Issuer served a Referral
Notice to the Trust referring the Dispute regarding EFVA / AEFVA to
adjudication. The adjudication timetable has yet to be
agreed.
Enquiries
The Issuer
The Coventry and Rugry Hospital Company Plc
8 White Oak Square
Swanley
Kent
BR8-7AG
Attention: Jacques
Mostert, Project Co. Representative.
Important information
This announcement is not a prospectus, is distributed
for information purposes only and does not constitute or form part
of any offer or invitation to issue, acquire or dispose of any
securities in any jurisdiction. Nothing in this document is
intended to amount to an invitation or inducement to engage in
investment activity. Nothing in this document amounts to the giving
of advice. If you are in any doubt as to the action you should
take, you should consult a professional adviser.