Hulland East Yorkshire Hospitals trust has bought a private Nuffield hospital to avoid contracting out services to the independent sector.

The trust said the new building, which will cost£10m to buy and improve, would save it money.

Chief executive Stephen Greep said: "The major element will be that it enables us not to have to use the private sector."

He said the purchase was an "opportunistic" decision taken after Nuffield opted to sell. It is also taking on the existing staff.

Demolishing wards

The trust will transfer ear, nose and throat and audiology services from Hull Royal Infirmary to the hospital, and breast surgery from its Castle Hill Hospital. It plans to demolish older Royal Infirmary wards.

"The advantage is being able to bring forward our estate development plans on our Hull Royal Infirmary site," Mr Greep said.

An increase in private work was not "in the plan" for the trust, said Mr Greep.

"We are not expecting major revenue gains," he added.

In April, East Kent Hospitals trust bought the company that ran a 22-bed wing on the same site as one of its premises. The company remained independent, however, with profits returned to the trust.