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Four Seasons debt odyssey – still one more year to go

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Four Seasons Healthcare, the UK care home operator, has finally completed its 1.5 billion pound debt restructuring, after a year of creditor wrangling. The group has ended up in the lap of lenders including RBS, which owns about about 40 percent of the company.

Now it has to set about refinancing 600 million pounds of asset-backed debt due next September, which makes up the bulk of its remaining 780 million pound debt pile. If the company can pull it off it will be extra good news for RBS, which managed to negotiate a deal giving it an extra slug of equity (just over two percent) in exchange for advisory services, based on performance.

Four Seasons isn’t the private healthcare group to end up in RBS’ loving hands. The bank also indirectly owns the Priory Group – which it inherited from ABN Amro. The Dutch bank’s structured financiers bought the group in 2006 and refinanced later in the asset backed debt market.

Four Seasons original owner, Three Delta, run by former Natwest banker Paul Taylor, was less lucky. The company defaulted after failing to refinance a two-year loan taken out at the time of its acquisition at the top of the market in late 2006.

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