BGN Entrepreneur

The banks that lent £1.5 billion to Four Seasons, one of Britain’s biggest care home operators, have written off about £800 million in a restructuring deal announced.
Four Seasons, a near-casualty of the credit crisis, has still to refinance £727 million by September next year, including a £600 million bond originally due in September 2008.
RBS, the 84% state-owned bank, is one of the lenders hit hardest by the restructuring deal. It led a consortium of 30 lenders that lent £1.5 billion to Three Delta, an investment vehicle of the Qatari Royal Family, to buy the care homes company in 2006. Those lenders have swapped the debt for a stake in Four Seasons. Because RBS held riskier debt than some of the other lenders, its stake in the company will be worth less than the near-40 percent of the debt it owns.
Three Delta had about £100 million of equity in the business, which it has walked away from. The Qataris were expecting hefty increases in profit at Four Seasons, previously owned by Allianz, which failed to materialize as the Government began to keep more elderly people in their own houses rather than in care homes. The deal will safeguard 20000 jobs at Four Seasons, which runs 330 homes with 16000 beds.

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