Firm 'aims to exit 132 care homes'
Friday 10 June 2011
Embattled care home provider Southern Cross Healthcare is planning to return 132 of its properties to landlords in a move that could cause disruption for hundreds of residents, it was reported today.
Southern Cross, the UK's largest care home operator with 31,000 elderly residents, has distributed documents to landlords that reveal plans to exit almost 20% of its 752 homes, the Financial Times said.
It is expected many of the properties will continue to be run as care homes by other operators or the landlords themselves, but documents conceded that a "double digit" number of the homes may close.
Earlier this week it revealed plans to cut 3,000 jobs, including more than 300 nurses, while 1,275 care staff, 700 catering posts, 440 domestic jobs and 238 maintenance roles could also go.
Southern Cross told its 80 landlords it was keen to work with them to "enable the orderly transition to an alternative operator of their choice".
Southern Cross recently warned it was in a "critical financial condition" as it unveiled a £311 million loss in the six months to March 31.
It plans to reduce its annual rent bill from £202.3 million to £137.5 million and recently announced it would cut the rent it pays to landlords by 30% as it tries to give itself some breathing space.
Darlington-based Southern Cross, which employs 44,000 staff, said proposals to slash its workforce by nearly 7% were part of its business revamp launched 18 months ago.
Yesterday it was revealed that concerns about management at its care homes have been raised by the social care regulator.
Of 49 homes reviewed by the Care Quality Commission (CQC) since October, it found issues with staffing levels at 19, it was reported.
Southern Cross confirmed 47 of the homes will be returned to landlords in the next four to six months, with the remaining 85 returned over the next two to five years.
A spokesman for the firm said: "Southern Cross's paramount concern is minimising disruption for its residents."
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