Southern Cross hit by talk of UK government bailout

Elizabeth Fournier
SHARES in troubled healthcare group Southern Cross fell more than 13 per cent to 9.65p in trading yesterday, after reports that it was seeking short-term financial support from the UK government.

The company, which provides care homes across the UK, is believed to be planning to meet with its landlords tomorrow to renegotiate leases as it struggles with rent payment.

Last month it switched its rent to monthly rather than quarterly payments to avoid a build up of outstanding debt.

Chief executive Jamie Buchan said in March that the company was planning to renegotiate the terms of its leases by July of this year.

Southern Cross warned in March that it could breach banking covenants, and appointed KPMG to help with its planned restructuring.