CHUM Project Reaches Financial Close

Health Montréal Collective Limited Partnership reached financial close on June 10, 2011, and entered into a project agreement with the Centre Hospitalier de l'Université de Montréal (CHUM) for the design, construction, finance, operation and maintenance of the new Centre Hospitalier de l'Université de Montréal in Montréal, Québec (the “Project”). The Project is the largest P3 hospital project in Canadian history.

The Project, with a net present value of approximately $2,000,000,000, will span more than 38.8 years and will include an anticipated 59-month construction period for Phase 1 and a further 47-month construction period for Phase 2, resulting in the longest construction period of any Canadian P3 project.

The CHUM, affiliated with the Université de Montréal, is one of the largest university hospital centres in North America. The Faculty of Medicine of the Université de Montréal is the fourth largest medical school on admissions count in North America and the largest in Canada with 4,500 students. It also has 400 professors, 1,600 clinical professors and numerous research scientists. It trains half of the health care professionals in the Province of Québec. As such, the CHUM plays a critical role in the elaboration and implementation of novel and safe health care approaches, as well as in basic and clinical research.

The CHUM will act as a tertiary and quaternary referral centre for 1.7 million people living in Québec, while at the same time providing both primary and secondary care service to the greater Montréal area, and providing a platform for diagnostic facilities supporting local primary care services.

Health Montréal Collective Limited Partnership is a special purpose limited partnership formed by Innisfree PFI Secondary Fund LP, Obrascón Huarte Lain S.A., Laing O'Rourke PLC and Dalkia Canada Inc. The design and construction of the Project will be made by a limited partnership formed by OHL Construction Canada Inc. and Laing O'Rourke Canada Ltd. The facility management and services of the Project will be handled by Dalkia Health Services Montréal L.P., a wholly owned indirect subsidiary of Dalkia International S.A.

To finance the Project, the consortium placed with Canadian and US institutional investors, by way of a confidential offering memorandum, senior bonds for an aggregate amount in excess of $1,370 billion, due September 30, 2049. The unwrapped bonds were rated BBB (high) by DBRS and Baa2 by Moody's.

The Project has the distinction of being: the largest P3 project in Canadian history; the largest P3 bond financing issue in Canadian history; one of the largest and most complex hospital projects currently under construction in the world; the longest construction period of any Canadian P3 project; the first rated deal with multiple construction phases; the first P3 project in Canada closed by each of Laing O'Rourke PLC, Obrascón Huarte Lain S.A. and Dalkia Canada as well as permitting equity distribution on deeply subordinated debt during the second phase of construction.

The group of funds managed by Innisfree Limited makes up one of the leading infrastructure investment groups in the United Kingdom sponsoring and making long-term investments in PFI and PPP infrastructure projects.

Laing O'Rourke PLC is a global provider of health care design and construction services and the United Kingdom's largest privately owned construction company.

Obrascón Huarte Lain S.A. and its affiliates is one of Europe's leading construction, concession, environmental development and industrial groups.

Dalkia Canada Inc. is a wholly owned subsidiary of Dalkia International S.A., which is the leading energy services company in Europe.

Innisfree was represented in-house by Sheila Jamieson; Obrascón Huarte Lain was represented in-house by Patricia Spa and Teresa Oeste and Laing O'Rourke was represented in-house by Derek Tadiello.

Blake, Cassels & Graydon LLP advised the successful consortium, with a team led by Alain Massicotte (infrastructure); Philippe Bourassa, Clémentine Sallée, Benoit Mallette, Claudia Léancu, Jeff Merrick and Samantha Rossman (project documents and subcontracts); Yannick Beaudoin, Katherine Girard, Aryana Rousseau, Stéphanie Martel and Mark Flynn (financial services); Daniel Ferreira, Martine Geoffroy and Manon Wolfe (real estate); Patrick Menda (corporate); Michael Bantey, Annie Torkia-Lagace and Eric Poole (securities); Jean Gagnon and John Leopardi (tax) and Réal Forest, Françis Rouleau and Marc-André Landry (administrative law). Investec North America Limited acted as financial advisor to the consortium.

RBC Dominion Securities Inc. acted as bond arranger and sole underwriter. McCarthy Tétrault LLP advised the underwriter. The McCarthy Tétrault team comprised Linda Brown, Sabine Audette-Hall, Samantha Cunliffe, Mathieu Dubord, Mary-Jeanne Phelan and Morgan Troke (financial services) and Sven Milelli (securities).

Gowling Lafleur Henderson LLP represented the design-builder consortium. The Gowlings team was led by Luc Lissoir and included David Kierans and Carine Taza (construction contract and related agreements); Rafal Wrzesien and Alexandra Lyon (corporate); Pierre Legault (bonding matters); Éric Thibaudeau (construction regulatory matters) and Myron Dzulynsky (client relationship).

Stikeman Elliott LLP represented Dalkia with a team comprising Erik Richer La Flèche (infrastructure); Ma Ry Tran and Lana Rabinovitch (financing) and Kevin Custodio (commercial).

Infrastructure Québec advised the CHUM in connection with the procurement process and was assisted by Fasken Martineau DuMoulin LLP with a team led by Claude Gendron (financial services) and including Andrew Ford, Lévy Bazinet, Jean Philippe Gagné, Helmut Johannsen and David Little (project documents – corporate and real estate); Marc Novello and Angela Onesi (financing) and Gilles Carli and Jean-François Perreault (tax).

The CHUM was represented by Heenan Blaikie LLP with a team led by Philippe Tremblay and including Chantal Sylvestre, Mariella Lo Papa, Lampros Stougiannos and Laurence Bich-Carrière (project documents); Claudette Bellemare (corporate) and Normand Quesnel and Marjolaine Arès (real estate).

The Government of Québec was also represented by its Executive Director who was represented in-house by Jean Pelletier.

HSBC Bank Canada acted as account bank and was represented in-house by Lynne Charbonneau, Deputy General Counsel, and Lorna Strong, Deputy General Counsel.