Patel in pounds 214m bid for health group

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The Independent Online
CHAI PATEL is making a comeback in the healthcare sector with a recommended cash offer for Westminster Health Care Holdings that values the nursing homes group at pounds 214m.

Dr Patel, former chairman of Court Cavendish Group and former chief executive of CareFirst Group, has formed a new vehicle, Canterbury Healthcare (CHC), to take Westminster private.

The offer is worth 311p per share, representing a premium of 68 per cent over the closing price of Westminster on 19 March. There will be a partial loan note alternative available.

Dr Patel said Westminster's board had unanimously agreed to recommend that shareholders accept the offer. He said: "We very much want to work with Westminster's management.

"The nursing home sector has been through a very difficult period. But we're taking a long-term view, and over the long term the prospects for the sector are very good," he said.

Dr Patel will become chief executive of the enlarged group, while Westminster's chief executive, Pat Carter, will act as a consultant. Mr Carter owns about 3 per cent of Westminster's stock, or 2.7 million shares, worth pounds 8.3m under the terms of the deal.

The deal fitted with the vehicle's long-term growth strategy, said Dr Patel. Canterbury's investors include private equity funds managed by US investment bank Goldman Sachs, as well as a number of large US healthcare funds.

Westminster, which is one of the UK's largest private-sector healthcare providers to the elderly, has 95 nursing homes with about 5,800 beds. It made pre-tax profits before exceptional items of pounds 16.1m in the year to 31 May 1998 on sales of pounds 134.6m.

The principal investors in CHC will be Whitehall Street Real Estate Limited Partnership XI, GS Capital Partners (funds affiliated with Goldman Sachs), an American healthcare fund called Welsh, Carson, Anderson & Stowe and WCAS Capital Partners.

Canterbury is also backed by Anthony Heywood, a long-time colleague of Dr Patel and a former finance director of Court Cavendish Group and former executive director of CareFirst.