Brussels refers Blackstone bid nursing homes to UK watchdog

THE OFFICE of Fair Trading (OFT) is to investigate the pounds 563m takeover of the nursing homes business NHP by Blackstone, the private equity group, over fears it may be anti-competitive.

Due to its size, the European Commission was reviewing the deal, which would have seen NHP merge with Blackstone's Southern Cross nursing homes business. But after a request by the OFT, the Commission said yesterday it would hand the investigation back to the UK authority. "The transaction will lead to some horizontal overlaps between the parties. [They] would become the biggest service provider in some local areas," the Commission said.

The OFT believes there could be competition issues in three areas, Arbroath, Nottingham and Port Talbot, where a merged Southern Cross and NHP would have a high combined market share. "The Commission has decided to refer the case as the concentration affects competition in a distinct market within the UK," Brussels said.

Blackstone announced its acquisition of NHP, one of the largest care homes providers in the UK, in November, only two months after its takeover of Southern Cross. NHP owns about 355 care homes, but only manages about half of them, and Southern Cross is one of its largest tenants. Through a takeover of NHP, Blackstone had hoped to cut costs. The two businesses would control about 18,000 care-home beds, a market share of up to 4 per cent. But its concentration in some regions is alarming UK competition bodies.

Upwards of pounds 1bn of nursing home assets are on the market at the moment amid a frenzy of corporate activity in what is a highly fragmented, but growing, care homes market.

Blackstone missed out on the takeover of Westminster Healthcare last year, which was bought instead by Barchester, a chain owned by the Irish entrepreneurs, Dermot Desmond, John Magnier and J P McManus, in a deal worth pounds 525m. Four Seasons, the second largest UK operator behind Bupa, was sold to the German insurer, Allianz, in July last year for pounds 775m. Also believed to be preparing for a sale is Ashbourne Healthcare, and BetterCare, a 3i-owned venture.

Paul Sapel, of LCS International, a consultant to the healthcare industry, believes the OFT investigation could have significant ramifications on other takeover deals. "The OFT is rattling the cage of the sector. A lot of companies thought they could keep buying other nursing home businesses may have to revisit their plans," he said. "But there is now a clear signal to the market that the OFT may restrict deals, which may put some people off bidding or lower the value of assets."

With an ageing population and a wealthier generation of elderly people, care-home beds are increasingly in demand.

News
Denny Miller in 1959 remake of Tarzan, the Ape Man
people
Arts and Entertainment
Cheryl despairs during the arena auditions
tvX Factor review: Drama as Cheryl and Simon spar over girl band

News
Piers Morgan tells Scots they might not have to suffer living on the same island as him if they vote ‘No’ to Scottish Independence
news
News
i100Exclusive interview with the British analyst who helped expose Bashar al-Assad's use of Sarin gas
PROMOTED VIDEO
Arts and Entertainment
Rob James-Collier, who plays under-butler Thomas Barrow, admitted to suffering sleepless nights over the Series 5 script
tv'Thomas comes right up to the abyss', says the actor
News
newsIn short, yes
Sport
Angel Di Maria celebrates his first goal for Manchester United against QPR
Football4-0 victory is team's first win under new manager Louis van Gaal
Arts and Entertainment
art
Arts and Entertainment
Calvin Harris claimed the top spot in this week's single charts
music
Sport
BoxingVideo: The incident happened in the very same ring as Tyson-Holyfield II 17 years ago
News
ebooksAn unforgettable anthology of contemporary reportage
News
Groundskeeper Willie has backed Scottish independence in a new video
people
Arts and Entertainment
The Doctor poses the question of whether we are every truly alone in 'Listen'
tvReview: Possibly Steven Moffat's most terrifying episode to date
News
i100
Life and Style
Cara Delevigne at the TopShop Unique show during London Fashion Week
fashion
News
The life-sized tribute to Amy Winehouse was designed by Scott Eaton and was erected at the Stables Market in Camden
peopleBut quite what the singer would have made of her new statue...
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

SQL Developer - Watford/NW London - £280 - £320 p/d - 6 months

£280 - £320 per day: Ashdown Group: The Ashdown Group have been engaged by a l...

Senior BA - Insurance **URGENT**

£400 - £450 Per Day: Clearwater People Solutions Ltd: **URGENT CONTRACT ROLE**...

Training Coordinator / Resource Planner - City, London

£35000 - £38000 per annum + Benefits: Ashdown Group: Training Coordinator / Pl...

Data Governance Manager (Solvency II) – Contract – Up to £450 daily rate, 6 month (may go Permanent)

£400 - £450 Per Day: Clearwater People Solutions Ltd: We are currently looking...

Day In a Page

These Iranian-controlled Shia militias used to specialise in killing American soldiers. Now they are fighting Isis, backed up by US airstrikes

Widespread fear of Isis is producing strange bedfellows

Iranian-controlled Shia militias that used to kill American soldiers are now fighting Isis, helped by US airstrikes
Topshop goes part Athena poster, part last spring Prada

Topshop goes part Athena poster, part last spring Prada

Shoppers don't come to Topshop for the unique
How to make a Lego masterpiece

How to make a Lego masterpiece

Toy breaks out of the nursery and heads for the gallery
Meet the ‘Endies’ – city dwellers who are too poor to have fun

Meet the ‘Endies’ – city dwellers who are too poor to have fun

Urbanites are cursed with an acronym pointing to Employed but No Disposable Income or Savings
Paisley’s decision to make peace with IRA enemies might remind the Arabs of Sadat

Ian Paisley’s decision to make peace with his IRA enemies

His Save Ulster from Sodomy campaign would surely have been supported by many a Sunni imam
'She was a singer, a superstar, an addict, but to me, her mother, she is simply Amy'

'She was a singer, a superstar, an addict, but to me, her mother, she is simply Amy'

Exclusive extract from Janis Winehouse's poignant new memoir
Is this the role to win Cumberbatch an Oscar?

Is this the role to win Cumberbatch an Oscar?

The Imitation Game, film review
England and Roy Hodgson take a joint step towards redemption in Basel

England and Hodgson take a joint step towards redemption

Welbeck double puts England on the road to Euro 2016
Relatives fight over Vivian Maier’s rare photos

Relatives fight over Vivian Maier’s rare photos

Pictures removed from public view as courts decide ownership
‘Fashion has to be fun. It’s a big business, not a cure for cancer’

‘Fashion has to be fun. It’s a big business, not a cure for cancer’

Donatella Versace at New York Fashion Week
The fall of Rome? Cash-strapped Italy accused of selling its soul to the highest bidder

The fall of Rome?

Italy's fears that corporate-sponsored restoration projects will lead to the Disneyfication of its cultural heritage
Glasgow girl made good

Glasgow girl made good

Kelly Macdonald was a waitress when she made Trainspotting. Now she’s taking Manhattan
Sequins ahoy as Strictly Come Dancing takes to the floor once more

Sequins ahoy as Strictly takes to the floor once more

Judy Murray, Frankie Bridge and co paired with dance partners
Wearable trainers and other sporty looks

Wearable trainers and other sporty looks

Alexander Wang pumps it up at New York Fashion Week
The landscape of my imagination

The landscape of my imagination

Author Kate Mosse on the place that taught her to tell stories