Hands up

21 November 2017 By Neil Unmack Follow @unmack1

The private equity tycoon who sued his adviser after the financial crisis is feuding with creditors of Four Seasons care homes. The battle hinges on whether lenders have a claim over some assets. The story of excessive and too-complex financing won’t help Hands’ next fundraising.

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H/2 Capital Partners, a creditor of care home operator Four Seasons Health Care group, said on Nov. 21 it had not received a formal response to its proposal to restructure the group’s debt, and urged the group to agree an interest standstill with bondholders to avoid a default and ensure the “stability of the group’s operations”.

Four Seasons is owned by funds controlled by Terra Firma Capital Partners. On Oct. 17 the private equity firm proposed a debt restructuring that would see creditors write down bonds, and transfer a further 24 care homes to the company that issued the debt. Terra Firma would keep a majority stake in the business.

The 24 private homes are the subject of a UK court hearing, scheduled for March 2018, in which Terra Firma is seeking a “rectification claim” to amend Four Seasons debt documents that accidentally granted security over them.

H/2 presented a rival restructuring proposal on Nov. 7.

On Nov. 8, Terra Firma said it was ready to transfer its ownership of the “high yield bond group” to creditors.

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