On the day briefing: NHSI transactions guidance
NHS Improvement (NHSI) has updated its guidance for trusts undertaking transactions, including mergers and acquisitions (M&A). The document provides guidance on organisational transactions undertaken by NHS trusts and foundation trusts, and on non-organisational transactions.
This briefing outlines the key changes that have been made to the guidance.
Key points of note include:
- NHSI has extended its assurance process to NHS trust -only transactions under the Single Oversight Framework (SOF) principle of treating NHS trusts and foundation trusts similarly wherever possible.
- NHSI have updated the transaction review process, reducing the number of stages from four to three. The previous strategic outline case (SOC) and outline business base (OBC) have been combined into one document called the strategic case with a single review stage (stage 1).
- NHSI have updated the risk factors it will consider when determining the depth of regulatory assurance each transaction requires.
- In an effort to increase transparency the guidance outlines what NHSI considers to be ‘red flags’ which may make it harder to set up the transaction for success and thus pose a risk to services for patients if identified at the strategic case stage. The identification of ‘red flags’ will prompt further engagement between NHSI and the trust(s).
- The document includes new guidance on capital funding. To reflect the ongoing constraints on capital funding, NHSI have outlined how trusts should approach funding transactions.
- The document includes an overview of NHSI’s M&A support offer to trusts preparing for an M&A, including additional legal guidance and information on management support arrangements. It also includes key learning points from previous mergers and acquisitions and key lessons from a review of recent transactions.