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Pathology contract with Synlab

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Dear Oxleas NHS Foundation Trust,

In January 2020, your organisation was one of five NHS organisations which announced that Synlab had been appointed as preferred bidder to provide pathology services, with an indicated contract start date in September 2020. Please answer the following questions:
1. Was your organisation aware that in February 2020, Synlab’s main shareholder, a private equity fund called Cinven, appointed a Swiss financial advisory firm called Lilja to advise on the sale or tock market flotation of Synlab.
2. Was your organisation aware that Synlab has issued bonds which mature in 2023, with an interest rate of 8.25%.
3. Was your organisation aware that this interest rate is much higher than the interest rate paid by most companies, and that financial analysts commentating on these bonds suggest that the high interest rate reflects a high level of risk that Synlab won’t be able to repay the debt.
4. Was your organisation aware that during March 2020, these bonds were trading at prices below 84% of their issue price, which financial analysts suggest was an indication that the market considered a high level of risk that these bonds would not be repaid by Synlab.
5. Has your organisation considered the possibility that Sonic Group of Australia, the parent company of TDL, who are the private partner in HSL, the other major private player in the NHS outsourced pathology market, may acquire Synlab and merge Synlab’s UK business with HSL.
6. Will Synlab be required to make investments of more than £10 million in the pathology service in order to fulfil their contractual obligations.
7. What guarantees are in place that will require Synlab to make such investments.
8. What sanctions do the contracting NHS organisations have in the event that Synlab refuse or are unable to make the required investments.
9. What rights would the contracting NHS organisations have in the event that Sonic Group or TDL or HSL acquire Synlab. Is there for example a change of control clause which would allow the contract to be withdrawn, and retendered or brought back in house.

Yours faithfully,

Frank Davis

FOI (OXLEAS NHS FOUNDATION TRUST), Oxleas NHS Foundation Trust

Dear Frank,

FREEDOM OF INFORMATION ACT 2000 – SECTION 8 REQUEST

Thank you for your request for information dated 10/05/2020. Your request has been managed under the terms of the Freedom of Information Act 2000.

Please note that Oxleas NHS Foundation Trust do not run acute hospitals or provide pathology services, and the information you have requested is not held by the Trust.

Oxleas NHS Foundation Trust are a community NHS Trust specialising in community health, mental health and learning disability services. For more information on services provided by Oxleas NHS Foundation Trust please visit our website at http://oxleas.nhs.uk/services/.

Following this response, your request for information will be closed.

If you have any queries or concerns or are dissatisfied with the service you have received in relation to your request, please do not hesitate to contact us. If you wish to make request a review of the decision, you should write to the: Information Governance Manager, Julie Lucas via email at [email address] in the first instance. If you remain unsatisfied with the outcome of your review and wish to make a formal compliant please address this to the Head of Complaints, Oxleas NHS Foundation Trust, Pinewood House, Pinewood Place, Dartford DA2 7WG - Email: [email address]

In addition if you are not satisfied with the outcome of your complaint or review, you may apply directly to the Information Commissioner’s Office (ICO) for a decision. Generally, the ICO cannot make a decision unless you have exhausted the complaints procedure provided by the Trust. The ICO can be contacted at: Information Commissioner's Office, Wycliffe House, Water Lane, Wilmslow, Cheshire, SK9 5AF (Telephone: 0303 123 1113 or 01625 545 745 - www.ico.org.uk).

Kind regards,

Paul Bransgrove
Information Governance Officer
E: [Oxleas NHS Foundation Trust request email]
Oxleas NHS Foundation Trust | Bracken House | Bracton Lane | Leyton Cross Road | Dartford | Kent | DA2 7AF

________________________________________
From: Frank Davis <[FOI #663930 email]>
Sent: 10 May 2020 20:05
To: FOI (OXLEAS NHS FOUNDATION TRUST)
Subject: Freedom of Information request - Pathology contract with Synlab

Dear Oxleas NHS Foundation Trust,

In January 2020, your organisation was one of five NHS organisations which announced that Synlab had been appointed as preferred bidder to provide pathology services, with an indicated contract start date in September 2020. Please answer the following questions:
1. Was your organisation aware that in February 2020, Synlab’s main shareholder, a private equity fund called Cinven, appointed a Swiss financial advisory firm called Lilja to advise on the sale or tock market flotation of Synlab.
2. Was your organisation aware that Synlab has issued bonds which mature in 2023, with an interest rate of 8.25%.
3. Was your organisation aware that this interest rate is much higher than the interest rate paid by most companies, and that financial analysts commentating on these bonds suggest that the high interest rate reflects a high level of risk that Synlab won’t be able to repay the debt.
4. Was your organisation aware that during March 2020, these bonds were trading at prices below 84% of their issue price, which financial analysts suggest was an indication that the market considered a high level of risk that these bonds would not be repaid by Synlab.
5. Has your organisation considered the possibility that Sonic Group of Australia, the parent company of TDL, who are the private partner in HSL, the other major private player in the NHS outsourced pathology market, may acquire Synlab and merge Synlab’s UK business with HSL.
6. Will Synlab be required to make investments of more than £10 million in the pathology service in order to fulfil their contractual obligations.
7. What guarantees are in place that will require Synlab to make such investments.
8. What sanctions do the contracting NHS organisations have in the event that Synlab refuse or are unable to make the required investments.
9. What rights would the contracting NHS organisations have in the event that Sonic Group or TDL or HSL acquire Synlab. Is there for example a change of control clause which would allow the contract to be withdrawn, and retendered or brought back in house.

Yours faithfully,

Frank Davis

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We don't know whether the most recent response to this request contains information or not – if you are Frank Davis please sign in and let everyone know.