Long Beach, Calif.-based HCP Inc. (NYSE:HCP) recently bought 30% of a United Kingdom nursing home chain’s junior debt, according to Sky News.
In the deal, HCP acquired about £175 million (about $264 million USD) of borrowings from Barchester Healthcare’s property arm at a discount from Isobel, a joint venture between private equity firm The Blackstone Group and the Royal Bank of Scotland.
Blackstone also owns about 20% of Barchester’s property arm’s junior debt, acquired from Lloyds Banking Group, says Sky News.
Toledo, Ohio-based Health Care REIT (NYSE:HCN) and Chicago-based Ventas (NYSE:VTR) are rumored to also be circling Barchester with possible plans to submit restructuring proposals, reports Property Week.
Barchester Healthcare has a £1.5 billion debt refinancing deadline this fall. The company will be splitting into an operating company and a property company. Its debt problems, according to Sky, stem from over borrowing against its property arm during the real estate market boom. The operational arm is not expected to be affected by the property arm’s debts.
HCP has previously had debt dealings with other UK nursing home chains. Last June, it bought a £136.8 million (approximately $215 million USD) unsecured sub-tranche of the debt package private equity firm Terra Firma used to acquire Four Seasons Health Care, the UK’s largest senior care provider
As of press time, HCP had not responded to SHN’s request for confirmation of the Barchester Healthcare debt acquisition.
Written by Alyssa Gerace.