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Sale of Care Home and Refinancing

Our client ran two care homes alongside a property development operation which was going through a difficult period. In order to prop up the property development venture, the client decided to sell its care home to a third party and to use the proceeds to support that part of the group. The group was family owned.

How we helped our client
At the time of sale, the market for selling care homes was highly attractive and therefore our client had a number of purchasers to consider. After a period of negotiation with potential purchasers, a deal in principle was agreed with a local care home operator. Our Transaction Tax team and EQ’s Corporate Finance team worked in tandem to ensure that the proceeds from the sale could be deployed by the property development subsidiary, without taxation issues.

Once the group debt had been reduced and restructured, the client identified a further, unanticipated, business debt, which entailed a further refinancing round to be negotiated. This involved our EQ Healthcare and Transaction Tax teams working together to find a new banker and to create a restructuring of business and personal assets to allow the client to concentrate on rebuilding its care home operations.

Two years on from that deal, our client is shortly to open a new home and has plans to open another. Our client’s personal debt structure has been set accordingly and there is a well-financed platform to allow our client to expand

For more information or to discuss further, please contact our Transaction Taxperts.

For further assistance with any corporate finance queries, particularly those relating to healthcare, please contact our Head of EQ Healthcare, Louise Grant on 01382 312100.

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