News update

I was surprised to read this on the Financial Times website yesterday. I would be interested to know what you think.
Sheila

8 Feb 2012 2:50am

Four Seasons races to refinance £780m in debt
Kate Mackenzie

Four Seasons, the UK’s largest care-home operator, will seek to raise up to £230m in new equity from existing shareholders and private equity groups, as it tries to refinance £780m in debt before a September deadline, reports the FT. The company became the UK’s market leader after the collapse last year of Southern Cross, taking 140 homes from its defunct rival. Unlike Southern Cross, Four Seasons owns most of its homes, which means it is less vulnerable to rent increases and pressure on fees. However, a similarly aggressive expansion strategy before the financial crisis left it burdened with debt of £1.6bn, which was halved in 2009 through a debt-for-equity swap. The reduced net debt of £780m, which falls due in September, is still too much to refinance in the current weak debt market, said Pete Calveley, Four Seasons’ chief executive. Although the company intends to pay off the existing debt in full and on time, it believes it will be able to raise only a significantly smaller amount of new debt.