17 May 2004

Interserve has reached financial close on the PFI contract with Cornwall County Council covering 17 schools in and around Truro and Penryn.  Interserve will deliver both construction and facilities services in the project, together worth approximately £95 million.  Pyramid Schools (Cornwall) Ltd, Interserve's consortium with the Bank of Scotland, was announced as preferred bidder for the contract towards the end of 2003.

Two of the schools will be completely new and will replace existing facilities.  These are the 1,350-pupil Richard Lander secondary school in Truro, scheduled to open in September 2006 and the Devoran primary school, scheduled to open in September 2007.  Building work on the remaining 15 schools will consist of extensions, remodelling and refurbishment.

Interserve will also provide facilities services to the existing schools for a period of 28 years beginning immediately and will do the same for the new schools when they open.  Services include building maintenance, caretaking and porterage, energy and utilities, catering, cleaning and waste disposal, security and grounds maintenance.

Both the construction and the facilities services will be managed by the specialist education unit within Interserve Project Services.  Interserve Investments will be responsible for the Group's £3 million investment, which represents 50 per cent of the equity and loan stock.   The Bank of Scotland will own the other 50 per cent and will share provision of the senior debt with the European Investment Bank.

Bruce Melizan, Managing Director of Interserve Investments, remarked, "This is a significant addition to our portfolio of education PFIs, which now accounts for seven of our 21 signed projects, 32 individual schools and just over 21,000 pupils.  Interserve has a strong track record in the south west and we're looking forward to providing an excellent service for the children and parents of Cornwall."