Terra Firma, a private equity group, announced on Monday its intentions to buy British nursing home operator Four Seasons Health Care for up to $1.34 billion, reports the New York Times.
The deal terms include Terra Firma paying about $1.32 billion up front for Four Seasons. Then, if the company hits its performance targets, according to the New York Times, the private equity firm will pay an additional £10 million pounds for a total of about £825 million.
Four Seasons operates 445 nursing homes and 61 hospitals and other healthcare facilities throughout Britain; it has previously been reported that rival nursing home operator Bondcare Group was planning a takeover of the operator, which has reportedly struggled to repay debt after a large acquisition.
The deal will be financed through Terra Firma’s cash reserves along with new funding provided by Goldman Sachs and Barclays, according to the private equity firm.
“By investing new equity, Four Seasons’ debt has been very substantially reduced and Terra Firma has brought stability to the company,” Guy Hands, a British financier who runs Terra Firma, said in a statement. “Four Seasons, with a stable capital structure and clear ownership, will be able to lead the sector in terms of quality of service.”
Barclays, Goldman Sachs, and law firm Slaughter & May advised Terra Firma on the deal. Rothschild, Gleacher, Shacklock, Deutsche Bank, and law firm Macfarlanes advised Four Seasons. The deal is expected to close by July 16.
Written by Alyssa Gerace