Care homes business Valeo bought in £15m deal
YORKSHIRE-BASED care homes business Valeo has been bought by quoted group CareTech Holdings in a deal worth up to £15.3m.
Valeo, which provides residential car and supported living schemes for adults for learning difficulties across Kirklees, Sheffield and Barnsley, will join Hertfordshire-based CareTech which is listed on the Alternative Investment Market and made pre-tax profits of 5.7m on turnover of £53m in the year to September 30, 2007.
CareTech is paying £11m in cash for Valeo, plus assuming £500,000 of liabilities and paying another £1m through the issue of new shares and will pay a further £2.8m in shares if the company achieves set performance targets.
Valeo, which has its head office in Huddersfield, has 10 care homes – five in Kirklees, four in Sheffield and one in Barnsley – which have a total of 71 beds.
Potters Bar-based Caretech was founded in 1993 by brothers Farouq and Haroon Sheikh and provides housing and support services to adults with a range of learning and physical disabilities.
It has a total of 1,073 beds at its homes.
It said the acquisition continued its strategy to take advantage of the consolidation opportunities in its market and increase the number of beds and homes its operates.
Since it floated on AIM in 2005 when it had 435 beds at 60 care homes, the group has more than doubled in size through five acquisitions, the most recent in April of Beacon Care for £22.5m.
Executive chairman Farouq Sheikh said: “We are delighted to welcome Valeo to the group. The acquisition opens up a new exciting region for us and increases our portfolio of quality freehold assets. Together with the acquisition of Beacon Care Homes in April, Valeo provides a significant uplift to our client capacity, which underpins future revenues and profits.”
CareTech today also announced a share placing to raise £30m and released its half-year results showing pre-tax profits had increased by 58% to £3.8m on turnover up 24% to £30.7m in the six months to March 31.
Mr Sheikh added: “CareTech has made further good progress in the first half of the financial year our acquisitions have been successfully integrated and are performing well. Organic growth continues ahead of market expectations and the group remains well place to deliver growth in future periods.”
