REG - Coventry&Rugby Hos. - Referral to Adjudication AEFVA

Assured GuarantyAnnouncement

02/02/2024 15:15

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RNS Number : 9113B  Coventry & Rugby Hospital Co PLC  02 February 2024

 

 

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.

 

 

 

 

 

 

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