Two holding companies of Four Seasons Health Care’s which is UK’s largest home care group, have appointed administrators to manage their debts. The firm announced that this step would not affect ongoing care arrangements with their patients and residents that number around 17,000 nor will it lead to closure of existing homes or removal of 20,000 staff. Medical director of the group Dr. Claire Royston stated that the change will not affect its operational procedures nor will it lead to disruption in the lives of its employees, residents or suppliers. It will instead be part of its restructuring process that will allow the group to move on in an orderly manner.
This is Britain’s largest home care organization to file for administration after collapse of Southern Cross during 2011. In recent years the firm has struggled with rising costs and cuts by local authorities in its care fees that affected its stability in the long term. National secretary of GMB union has urged the government to step in and help the organization stating that lack of funding led to the crisis. Four Seasons announced that the task of administration has been handed over to services firm Alvarez and Marsal.
The operating firms that run these homes are not in administration so it can continue providing assistance while it scouts around for a new owner. The Four Seasons currently runs 322 nursing and residential care homes but has a whooping debt of £500million and is in control of US based hedge fund H/2 Capital Partners. In past few years several care business have faced financial troubles that has led to questioned being raised about existing funding model. Allied Healthcare which supports 13000 people said last year that its debts were mounting and blamed low council fees for its financial issues.