Four Seasons Health Care plans sale after parent’s three-year bankruptcy | business news

Four Seasons Health Care, one of the UK’s largest care home operators, is putting most of its operations up for sale three years after its holding companies went bankrupt amid an impasse over its massive debt burden.

Sky News has learned that Four Seasons managers have hired property agent Christie’s to oversee an auction of its core portfolio, which consists of around 110 locations across the UK.

According to a real estate source, the nursing homes employ around 10,000 people in total and care for 6,000 residents.

The sites for sale exclude Four Seasons’ Northern Ireland business, which is the subject of a separate deal due to close next month.

The operation of the nursing homes should remain unaffected by the sales process.

In an earnings presentation released in March, the company said its joint administrators “continue to evaluate all possible options for the group’s organizational and capital structure.”

“This includes potential sales of all or part of the group, internal restructuring, refinancing, financial debt restructuring (which may or may not include a debt-to-equity swap) and/or a combination of the above.

“At this point nothing has been decided as to the options or timing and the Joint Administrators and the Group will decide on the most appropriate option in due course, focusing on the interests of the Group and its relevant stakeholders and.” these maintain continuity of care.”

Four Seasons will now be led by Joe O’Connor, a restructuring expert who joined AlixPartners as a partner last year.

Mr. O’Connor has assumed many of the CEO responsibilities from Jeremy Richardson, who stepped down as Chief Executive earlier this year.

Like competitors like HC-One, Four Seasons endured a violent pandemic, with the nursing home industry in the eye of the storm as licenses dried up and staffing levels were decimated by self-isolation rules.

In its 2021 results, it said its nursing home division posted earnings before interest, taxes, depreciation and amortization of $22.4 million.

The company said the wave of infections that swept the UK in December 2021 and earlier this year has continued to impact occupancy, partly due to Public Health England regulations and labor shortages.

It added that “the perceived risk of the virus understandably makes people nervous about placing loved ones in care homes, not because of the direct health risk but because of concerns about future lockdowns and forced isolation.”

The Four Seasons holding companies collapsed in April 2019 and since 2012 have been owned by Terra Firma Capital Partners, the private equity vehicle led by financier Guy Hands.

The nursing homes themselves were never in insolvency proceedings.

Terra Firma paid £825m for the deal but FSHC’s debt pile of over £500m has been the subject of lengthy restructuring negotiations.

At the time of the collapse, Mr. Hands’ fund no longer had operational control of Four Seasons as much of its debt had been purchased by H/2 Capital Partners, a US-based hedge fund.

Alvarez & Marsal (A&M), the professional services firm, was named administrator in 2019, making it the largest bankruptcy in the nursing home sector since Southern Cross collapsed in 2011.

A previous sale process was completed in 2019 which anticipated the sale of The Huntercombe Group, its specialty care division.

A spokesman for Four Seasons Health Care said: “Throughout the restructuring process, the continuity of care for our residents and the support of our team members has always been and always will be our priority.”

Four Seasons Health Care plans sale after parent’s three-year bankruptcy | business news

Source link Four Seasons Health Care plans sale after parent’s three-year bankruptcy | business news

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