Four Seasons care homes in talks with new investors

The company's largest shareholder, Royal Bank of Scotland, and several other investors, are also looking at pumping extra cash into the business, which is responsible for 500 nursing homes and 25,000 residents.

Hong Kong billionaire Li Ka-shing, who owns a healthcare business called CK Life Sciences, and private equity group Kohlberg Kravis Roberts have both been linked to a potential deal with the company, which is struggling with £780m of debt.

Four Seasons became the largest UK operator following the collapse of Southern Cross. It took on 140 of Southern Cross's properties after last year's crisis.

Other interested parties include the Abu Dhabi Investment Authority and Canada's Ontario Teachers' Pension Plan.

The company has begun refinancing talks ahead of a September deadline but there are fears it will not be able to raise sufficient funds through fresh loans.

Advisers at Rothschild and Gleacher Shacklock bank have been engaged to find ways of plugging a funding hole, estimated at between £100m and £200m.

The company has already approached shareholders about a fresh equity injection, but not all are keen, ruling out a regular rights issue. It has therefore opened talks with potential new investors.

It is believed advisers may also have been trying to flush out potential buyers for the group.

However, a spokesman denied it was up for sale, or that a takeover was one of the options under consideration.

Existing shareholders of Four Seasons also include Credit Suisse; National Bank of Kuwait; Nationwide, and the Qatar Investment Authority.

The refinancing is the second for Four Seasons in three years, following a £780m debt-for-equity swap with lenders in 2009.

Four Seasons said in a statement: "The board and its financial advisers are considering alternative capital structures to ensure that appropriate levels of funds will be in place by September 2012 to match the group's financing objectives.

"These include refinancing, new equity from existing shareholders, as well as potential funding from new investors or combinations of these options."

 

Sourced from The Telegraph, 20th February 2012.