Care home operator on brink of administration
Debt-laiden care home group Four Seasons is on the brink of going into administration as the deadline for a £26m interest payment looms a week tomorrow (Friday, December 15).
The Cheshire-based group – the UK’s largest care home operator – is at the centre of a dispute between its backers Terra Firma, run by tycoon Guy Hands, and its biggest lender, the US hedge fund H/2 Capital Partners.
As well as 17,000 vulnerable residents, Four Seaons has 25,000 employees and uses hundreds of agency workers.
Hands bought debt-ridden Four Seasons in 2012 for £825m and H/2 Capital Partners has bought up an estimated £256m of Four Seasons debt since 2015.
Robbie Barr, chairman of Four Seasons Health Care said: “Four Seasons is seeking to achieve an orderly and timely handover from Terra Firma’s ownership to the creditors through a restructuring.
“This week we have opened our books to the advisers of our single largest creditor which is another positive step forward towards a restructuring.
“In the meantime, all the parties agree that the needs of our 17,000 residents and the smooth running of the business are of the utmost importance.”
A spokesperson for Terra Firma said: “There is no reason to put Four Seasons into administration.
“Despite having written off its £450m investment in the Four Seasons business in 2015, Terra Firma has continued to invest in Four Seasons and drive operational improvements in care quality.
“Terra Firma’s priority has been continuing to run the homes well for the benefit of the many elderly and vulnerable patients.
“We call on H/2 Capital Partners, who have acquired their debt at a discount since 2015, to stand by its commitment to find a consensual outcome for the benefit of employees and residents and head off the risk of the obvious disruption that administration would trigger.”
Meanwhile, health watchdog Care Quality Commission is poised to step in to stop Four Seasons from taking on new residents amid concernts that its financial difficulties may affect the quality of care.
A spokesman said: “We continue to closely monitor developments. I would like to confirm at this point in time we do not believe that services are likely to be disrupted as a result of business failure.”
