The main lender to Four Seasons Health Care has urged the troubled care homes operator to agree to a debt standstill before an interest payment deadline threatens to push it into administration.
H/2 Capital Partners, the dominant owner of Four Seasons’s £525m bonds, said it had offered a deferral on a £26m bill due on December 15. It urged immediate action to take the pressure off stalled restructuring discussions.
The operator, which has 17,000 beds nationwide, has said it will not make the interest payment in order to preserve funds to keep its care homes running over Christmas. Without a standstill it will be in default on its debts.
It is running out of cash while its private equity owner Terra Firma is in dispute with H/2 over the fate of a £136m group of 24 care homes that are held as security against Four Seasons debts.
Four Seasons and Terra Firma claim the homes have been mistakenly included in in the finance structure due to an error by its lawyers Allen & Overy. H/2 said its offer of a standstill until April includes a pledge to “agree to disagree” on the matter until it is decided by the High Court.