The 25-year term contract can now begin in mid August with the transfer of 480 council staff to the firm.
Work will involve tackling the backlog of repairs and refurbishing the city’s roads, pavements, bridges and streetscene during the first five years.
The emphasis will then switch to maintenance throughout the remaining 20 years of the contract.
The PFI contract includes the improvement and the ongoing maintenance of the city’s 1,900km of road, 3,300km of footway, 36,000 highway trees, 500 traffic signals, 68,000 street lights, over 18,000 items of street furniture and 12,700 street name plates.
The project is supported by the Department for Transport who have agreed to provide an investment totalling £1.2bn over the life of the contract.
Mel Ewell, chief executive at Amey said: “Securing the funding required is a major achievement in this challenging financial market.
“Since we were appointed as preferred bidder in April we have had a very close working relationship with the council which has enabled us to be fully prepared to start the improvement works in August.
“We’re now eager to make a start on transforming Sheffield’s highway network and streetscene for the benefit of everyone who uses it.”
The contract will see Amey improving and maintaining the city’s highway assets as well as providing street cleaning and grounds and tree maintenance and carrying out all winter maintenance duties.