Interserve and its joint venture partner Kajima have reached financial close on the project to design and build seven UK secondary schools across Hertfordshire, Luton and Reading.

This is one of the first batch of schools to be funded using the government's new PF2 private finance model.

The scheme, which was procured under the Priority School Building Programme (PSBP), has a capital value in excess of £135 million (US$201.7 million). More than 8,900 pupils across the South East region will benefit from this investment, with almost 900 additional places for 11-18 years old to be created in modern, purpose-built buildings.

Interserve and Kajima will each invest 45% of the equity in the scheme, with the remainder of the equity coming from HM Treasury's PF2 investment arm, IUK Investments Limited. The senior debt is being provided by a Department for Education procured funding vehicle backed by an Amber-led consortium comprising International Public Partnerships Limited (INPP) and Aviva Investors, with the European Investment Bank also providing senior debt.

The team which was appointed preferred bidder by the Education Funding Agency (EFA) in April 2014, will be responsible for the design and construction of the schools as well as all maintenance services over 25-years. 

Dougie Sutherland, Executive Director at Interserve stated::

"This is the 20th privately-financed education project in which the Group has invested and underlines our support for the Government's investment in education. As well as providing some 900 new schools places for students in Hertfordshire, Luton and Reading, we will commit to take on more than 50 young people to work on the projects under NVQs, apprenticeships and work placements."

The secondary schools included in this tranche are: Bishop's Hatfield Girls' School, Hatfield; Goffs School, near Cheshunt; Kings Langley School, Kings Langley; Longdean School, Hemel Hempstead; Reading Girls' School, Reading; Stopsley High School, Luton; and Westfield Academy, Watford.

Construction started on all the schemes last month with the first due for completion in August 2016. All of the new schools will be open by November 2016.

In November 2014 we reported that Amber-led consortium reached commercial close on the funding scheme to the project and other four batches of schools being delivered through the PSBP. The five batches are the following:

• Batch 1 - Priority School Building Programme (Hertfordshire, Luton and Reading)
• Batch 2 - Priority School Building Programme (North East)
• Batch 3 - Priority School Building Programme (North West)
• Batch 4 - Priority School Building Programme (Yorkshire)
• Batch 5 - Priority School Building Programme (Midlands)