The Barnet General Hospital project is an example of how an offshore infrastructure fund gains 100% equity ownership.
HSBC Infrastructure originally had a 30% equity stake in Metier Healthcare Limited, the SPC of the Barnet General Hospital PFI project (financial close 12 February 1999). This stake was sold to HSBC Infrastructure Company Limited (now HICL) when it was floated on the London Stock Exchange in March 2006, but registered in Guernsey. Within the decade, HICL had acquired 100% shareholding by acquiring the remaining shares in four transactions for £12.3m (the profit earned by Siemens, Bouygues and London Financial Group who sold their shares was not disclosed).
• 2006: Barnet Hospital project Ltd was one of 15 PFI assets sold for £250m by HSBC to HICL, a new company listed on London Stock Exchange, but registered in Guernsey.
• 2006: Bouygues sells 11% stake to HICL (now 41%).
• 2007: London Financial Group sells 10% stake for £3.3m to HICL (now 51%).
• 2009: Siemen's sells 30% stake for £2.7m to HICL (now 81%)
• 2009: Bouygues UK and Ecovert FM sell 19% stake for £1.7m to HICL (now 100%).
Metier Healthcare recorded £10.6m pre-tax profit in the thirteen years 2000-2012. It paid just £1.3m in taxes because of tax losses, which enable it to carry forward against future profits. The company had a net debt of £26.5m at 31 March 2012 after taking account of £10.5m cash in the bank. It has paid shareholders £3.0m in dividends, largely to HICL, since 2009.
The scale of PPP equity transactions is significantly larger than previously disclosed and extends to virtually all public services. The next section details the evidence of high rates of return and profiteering.