It was only a few weeks ago that I was writing what I hoped might be the final chapter in the story of the plight of Southern Cross’s 130,000 elderly residents (click on “Southern Cross” in the TAG CLOUD). Goodness knows those residents have been through enough worry and uncertainty about their future. After being completely disowned by the Government and ignored by the CQC, who is supposed to safeguard their vulnerability, they were finally passed back to their over-mortgaged landlords.
The biggest one of them is Four Seasons, whose majority shareholder is the dodgy-these-days Royal Bank of Scotland, with a 40% stake. Not far behind in ownership is the Qatar Investment Authority. Both companies are known for their love of older people – at least as a commodity.
Four Seasons, with 500 properties and with 25,000 residents, is now the UK’s largest nursing home operator. It has the minor problem of repaying £780 million in loan debt by September. Nothing to concern the Government or CQC about there then !
Not to worry, hope is on the horizon. A very nice group of people in America, who are very, very interested in old people, are quietly buying up some of Four Seasons loans. It is a strange idea, buying up loans from other people. Only sharpe-suited financiers and body-guarded East End loan sharks really understand the not so subtle finger-breaking techniques of debt collection. I guess they must have seen the real potential in the UK elderly market, having watched Southern Cross go bust.
These ever-to-be or never-to-be trusted investors are Kohlberg, Kravis, Roberts (KKR). In the 1990’s they were so liked that a book was written about their hostile takeover of RJR Nabisco entitled “Barbarians at the Gate”. It’s all about greed, asset stripping, redundancies and company break-ups. No doubt the Government and CQC will consider them ideal partners to look after our frailest older people.