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Partnerships UK, the Treasury's PFI advisory body, announced this week that it had turned itself into a public–private partnership after a public float.

PUK has sold a 51% stake to 11 companies, including contractor Jarvis. The sale, which raised £23m, was oversubscribed by 30% with 50 firms showing interest. The Treasury, which owns the remaining 49%, has contributed £22m.

PUK intends to use the money to contribute to procurement funds, and may take equity stakes in projects. It can also borrow up to £50m, giving it £95m in total.

PUK chief executive James Stewart said the strong interest in the venture showed there was widespread support for PPPs.

He said: "The development phase of PUK is now complete.

"PUK can now deploy capital to energise the PPP market and fulfil its mission to help the public sector deliver PPPs." When the plan to float PUK was announced last month, there were concerns in the City that contractors that bought a stake might have a conflict of interest.

PUK dismissed these claims, saying the structure of the company would prevent this happening, as the investors would not have a say on contracts.

PUK chairman Derek Higgs highlighted the diversity of investors. They include Axa Investment managers, Prudential, Abbey National, Barclays, Royal Bank of Scotland, Bank of Scotland, Halifax, Serco, British Land and Group 4 Falck.

He said: "I particularly welcome the quality and diversity of the shareholders and I look forward to working with them to drive PUK's business forward." Treasury chief secretary Andrew Smith said PPP was now here to stay. He said: "I am delighted at the signal this sends not only about PUK but about the future of PPP and PFI.

"The market has given a vote of confidence to the development of public-private partnerships across government.

"The level of interest from investors is a clear vindication of the government's approach to delivering modern, high-quality public services and promoting the UK's competitiveness." PUK was formed last year out of the Treasury's PFI taskforce to make PFI and PPP contracts run more smoothly by combining private sector expertise with a public sector mission.

PUK is expected to invest up to £5m in LIFT, a £1bn scheme led by the Department of Health to build 500 GPs' surgeries and to modernise another 3000 through a series of PPPs.

PUK will also advise the government on PFI contracts and help local authorities to procure public-private deals.