The care home company created in the wake of the Southern Cross collapse is weeks away from being sold in a £535m deal which could net senior management a £5m bonus.
The sale of HC-One will generate the one-off windfall for the senior management team at HC-One, a company formed of Court Cavendish, owned by Chai Patel, and NHP, Southern Cross’s biggest landlord.
American company Formation Capital is leading the pack of suitors hoping to take control of the business.
Southern Cross went bust and collapsed in 2011 amid mounting debt and the rising cost of renting the 750 care homes it managed. Shareholders in the business, which ran care homes for around 31,000 elderly residents around the UK, lost everything.
Court Cavendish teamed up with NHS and took control of 240 of the properties in 2011, with NHP retaining the freehold and Patel’s company running the homes.
The US-based investor in elderly care already runs 60,000 beds in America.
The sale is complicated by ongoing legal action between NHP and its bondholders, after the freeholder ran into hundreds of millions of pounds worth of debts. NHP’s creditors are understood to be appealing a High Court decision to throw out a case seeking to block the Formation deal from going ahead.
A spokesperson for NHP said yesterday: “In September 2013, NHP, the owners of HC-One, appointed strategic advisers to consider the next phase of HC-One’s future.”
“It remains the case that no final decisions have been made, and we will continue to communicate directly with residents, relatives and staff as the process continues.”
It did not confirm or deny whether management were in line for the bonus once the business is finally sold on.
Kate McCann, Michael Bow