INSO ‘financially strong’ for projects, to deliver financial guarantees for SXM general hospital | THE DAILY HERALD

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An artist’s impression of the new St. Maarten General Hospital.

CAY HILL–It seems the construction of St. Maarten’s new general hospital will continue with Italian construction company INSO as general contractor for the major project.

St. Maarten Medical Center (SMMC) met last week with the extraordinary commissioners of INSO, the contractor of the new St. Maarten General Hospital, and the consortium of the lenders regarding the status of the project. Health Minister Emil Lee was in attendance.

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The extraordinary commissioners informed parties during that meeting that with the support of the Italian government, they have secured financing equal to 30 million euros which will be used to comply with contractual arrangements for the St. Maarten hospital project.

“Such obligations include the extending and increasing of the already-existing performance bond to an amount of almost US $8 million and submitting an advance payment bond of $3 million. As a result of the EAP [extraordinary administrative procedure – Ed.] and the financial support that we received, INSO is financially strong enough to comply with all its obligations of all the ongoing projects and new projects,” SMMC quoted the extraordinary commissioners as saying.

INSO is also working with SMMC and the lenders to provide additional comfort and/or guarantees.

The extraordinary commissioners were appointed by the Italian government following INSO’s admittance to the EAP in December 2018 to guarantee the continuity of INSO’s business. The extraordinary commissioners stressed that the St. Maarten Hospital project had been carefully evaluated and they had determined that the project is part of the company’s strategic vision. They then went into a detailed presentation on why they are financially able to guarantee completion of the new hospital.

INSO assured SMMC and the lenders that if final approval is granted it can begin onsite mobilisation as early as July 2019 and be positioned to begin the main construction in the third quarter of this year. If all goes to plan, the main building will then be opened 2½ years later.

SMMC General Director Kees Klarenbeek welcomed this plan on the condition that all required documentation and guarantees are completely in place before the site mobilisation can occur.

Lee gave a presentation on the Health Ministry’s role and the national health reform process, which includes changes to referral programmes, tackling the high cost of prescription drugs, general health insurance, and the new general hospital, amongst other things, which are a critical part of the reform process.

The INSO crisis was mainly a combination of the economic and financial crisis in the construction industry in Italy and the problems with Condotte d’Acqua, INSO’s parent company.

“We are carrying out a plan aimed at the sale of the INSO’s assets without its liabilities, through and at the preservation and enhancement of the company’s assets, activities and operations on a going concern perspective. … We have the funds and the resources to complete the General Hospital in St. Maarten,” said the extraordinary commissioners.

The St. Maarten General Hospital is part of the programme that will be submitted to the Italian Ministry of Economic Development before June 5.

“We do expect that the Ministry will approve this programme within one month and then we will start with the sale of the company to a well-qualified buyer. This will take six to 12 months.

“The whole idea behind the EAP is to continue the business and the safeguarding of INSO’s resources. In order to safeguard this, the new owner has to provide a very substantial performance bond to the Italian government and we, the extraordinary commissioners, will be monitoring that this new owner will live up to his obligations for at least a period of two year after the sale is completed.

“Nothing will change for the construction of the new St. Maarten General Hospital. We will use the same architect, the same subcontractors and, above, all the same people of INSO,” the commissioners said.

Klarenbeek said the meeting had been “very informative” and constructive. “It is good to hear from the decision-makers from INSO what the actual situation is and what INSO’s plans are. The new hospital of St. Maarten is too important for the people of St. Maarten, Saba and St. Eustatius, and our visitors. We need to ensure that the construction will be done according to the plan and the budget. This meeting confirms that this will indeed be the case,” Klarenbeek said.

“We made some firm agreements and INSO has now to deliver the financial guarantees and the other documents as discussed, which will not only be reviewed by SMMC, but also by our lenders consortium. It is our aim that before the end of June 2019 we will have all guarantees in place, after which we can finally start with the mobilisation of the project, as we already have the building permit and SMMC and INSO continued to work on the final design since December 2018.”

Source: The Daily Herald https://www.thedailyherald.sx/islands/87649-inso-financially-strong-for-projects-to-deliver-financial-guarantees-for-sxm-general-hospital

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