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Four Seasons appoints advisors to sell assets worth £60m

Troubled care home business Four Seasons Health Care has appointed Christie+Co and Knight Frank to sell care homes assets worth £60 million in total according to Property Week.

Four Seasons has appointed Christie+Co to sell 14 individual properties as going concerns, worth up to £30 million collectively. These are set to be sold before the end of the year despite some of the homes being located in lower-value areas, reported Property Week.

The beleaguered business has separately appointed Knight Frank to sell a portfolio of homes that are currently run by third party operators, also worth an estimated £30 million.

The news comes as credit ratings agency Standard & Poor’s said in early November that Elli Investments, the umbrella company for Four Seasons’ bonds, risked running out of money in the next six months.

The ratings agency said that in its view “the group's currently available liquidity will likely be consumed by the first semester of 2016 from annual cash interest and rent obligations totalling around £110 million, as well as capital expenditure (capex) in relation to the group's ongoing segmentation and refurbishments across its homes.”

Standard & Poor’s added that the firm would have less than £20 million in cash by the end of this year.

In October, the care home giant brought in Blackstone spin-off PJT Partners and magic circle law firm Allen & Overy to review its financial structure.

Elli Investments told noteholders at the time that while the group had "sufficient medium-term financial flexibility" it would "conduct a review of its current financing to further enhance that flexibility".

Ben Taberner, chief financial officer at Four Seasons, told bondholders that a financial review would be carried out with "all options" considered.

The company is currently struggling under the weight of over £500 million worth of debt with an annual interest bill of £50 million.

The company has attributed its financial pressures on constrained local authority fees and a sector-wide nursing shortage meaning an increase in the use of pricey agency staff.

Private equity firm Terra Firma bought Four Seasons for £825 million in 2012.

The firm is split into three divisions: brighterkind which has approximately 80 private pay-focused care homes; Four Seasons which has around 350 homes; and The Huntercombe Group which runs around 40 specialist mental health facilities.

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Posted on: 06/11/2015

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