Mersey Gateway reaches financial close
The £600m Mersey Gateway project has achieved financial close, the conclusion of the negotiations over the contract, with construction expected to start on site in the coming weeks.
The civil engineering project will deliver a six-lane bridge designed to improve links between Runcorn and Widnes on the route into Liverpool, easing congestion on the existing Silver Jubilee Bridge.
The close follows the announcement in the Chancellor's Budget on 19 March that the Mersey Gateway project would be receiving a £270m Government guarantee, covering around 50% of the senior debt required to finance the development.
The Merseylink consortium, which includes Kier, FCC, Bilfinger, Samsung CT and Macquarie, was awarded the contract to design, build, finance, maintain and operate the bridge in June 2013.
Construction is expected to last three-and-a-half years, with the bridge initially scheduled to be opened to traffic in the first half of 2017.
KPMG acted as financial adviser to Halton Council on the scheme.
Richard Threlfall, head of infrastructure, building and construction at KPMG, said: "Today's financial close of the Mersey Gateway PPP project is a big deal in all senses. As one of the largest transport projects outside London in a decade, it is a big deal for Merseyside. As the first project in the UK to be contracted for open road tolling, it will be a big deal for drivers who don't want to get stuck in queues at toll booths. And it is a big deal for the Treasury as it is the first project to be supported by a UK Government Guaranteed Bond under the UK Guarantees programme.
"After the failures of previous projects like Merseytram, it is highly symbolic that Merseyside has been able to close a deal of this size, and that it has been done by a Council whose financial income is dwarfed by the scale of the project. It is also a politically important deal for the UK Government who is keen to show that it is investing in infrastructure in the North as well as in the South of the country."
