The owner of 445 care homes which is responsible for looking after some 20,000 residents has agreed to be sold to financier Guy Hands' private equity firm for £825 million, it was announced today.
Four Seasons Health Care, the UK's largest independent elderly and specialist care provider with 30,000 staff, which also owns 61 specialist care centres, will be sold to Terra Firma.
Mr Hands, founder, chairman and chief investment officer at Terra Firma, is perhaps best known for his failed investment in British music company EMI.
He said: “Our number one priority is to ensure that Four Seasons delivers consistent high-quality care and peace of mind for residents, service users and their families.”
The deal is expected to complete on or before July 16, at which point Four Seasons' debt liabilities will be discharged in full.
The £825 million price tag is being financed through a mixture of equity and new debt, with the debt being arranged by Goldman Sachs and Barclays.
Four Seasons has achieved a turnaround in quality of care and business performance, and is trading profitably, Terra Firma said. It owns around 60% of the facilities it operates.
The requirement for elderly and specialist care provision is forecast to grow annually by 3.1% over the next 10 years, driven by the needs of a growing elderly population.
Four Seasons chairman Geoff Westmore said: "Our current lenders will be repaid in full and, going forward, the company will have a substantially lower amount of debt and a stable and secure financial structure.
"This will enable Four Seasons to continue doing what it does so well, which is provide first-class care to our residents and reassurance to their families.
"I have been impressed with Terra Firma's enthusiasm for the business and their commitment to the company's future and to maintain our high standards of quality."
The deal follows Terra Firma's rescue last month of The Garden Centre Group.
Mr Hands, who lives in Guernsey, started his career in the early 1980s at Goldman Sachs.
Investment bank Citigroup seized control of record label EMI from Mr Hands following a protracted legal battle last year.
EMI - home to artists including Lily Allen and Robbie Williams - saw its debt cut from £3.4 billion to £1.2 billion under the terms of the deal.
The music group had been bought by Terra Firma in 2007, with the buy-out group borrowing billions of pounds from Citi to finance the ill-fated takeover.
Mr Hands tried to sue Citi for up to £7 billion after accusing the bank of pretending that other bidders were interested to bump up the price, but lost the case.