Care home company Four Seasons Health Care has won a reprieve on a major debt repayment which threatened the future of the firm.
The group, which looks after 17,000 elderly along with also vulnerable residents, had been due to make an interest payment of £26m by Friday.
However, Four Seasons has only £24.8m in cash along with also will be £540.2m in debt.
the idea said the delay “ensures continuity of care for Four Seasons’ residents” along with also stability for its employees.
The Care Quality Commission (CQC), the UK’s health watchdog, had been forced to step in to ensure that will Four Seasons reached an agreement with its biggest creditor, the US fund manager H/2 Capital Partners.
Andrea Sutcliffe, chief inspector of adult social care at the CQC, said: “The Care Quality Commission has been consistently clear that will people using any adult social care service, their families along with also carers, should be able to expect that will the service will provide not bad quality care which can be sustained into the future”.
Ms Sutcliffe added: “Through our market oversight function, we will continue to closely track progress with the ongoing restructuring discussions until such time that will they are satisfactorily concluded. Our market oversight regulatory responsibility will be to advise local authorities if we believe that will services are likely to be disrupted as a result of business failure.
“I could like to confirm at that will point in time we do not believe that will services are likely to be disrupted as a result of business failure.”
Four Seasons, which employs more than 25,000 people, said the idea aims to agree a restructuring plan 7 February next year along with also gain approval for the strategy by 2 April.
The care home was bought by the private equity firm Terra Firma in 2012 for £825m, the majority of which was made up of bond debt which carries regular interest payments.
H/2 Capital Partners then acquired the debt along with also Terra Firma subsequently offered to hand over the keys of the business to the firm.
Robbie Barr, chairman of Four Seasons, said the company will be “very pleased to have reached a standstill agreement with H/2”.
He said: “The standstill gives a period of stability for the company along with also its stakeholders although most importantly for our residents, patients, their families along with also our employees.”
Analysis, Alison Holt, Social Affairs correspondent
At the heart of that will business deal are the 17,000 vulnerable, older along with also disabled people who rely on the 24-hour-a-day support provided by Four Seasons’ staff, whether the idea will be helping them eat, wash or simply taking the time to talk. As lawyers along with also financial experts pored over the details of that will deal into the early hours, they were negotiating over the future of those people’s homes.
that will deal provides certainty inside the run-up to Christmas, although the idea will be a first step in what will have to be a major restructuring. The main creditor, H/2 Capital Partners, has investments in senior living or similar nursing homes inside the US. I’m told they’ve not had one particular foreclosure or bankruptcy along with also are determined to put Four Seasons on a more stable financial footing.
although even without crippling interest payments, Four Seasons will be operating in an extremely tough care market. Most of its residents are publicly funded, council budgets are squeezed along with also staff costs rising. For many inside the care sector, Four Seasons’ difficulties are worryingly familiar.