Four Seasons Settles on Debt Restructuring Plan

Four Seasons Health Care, a company that operates care homes, recently announced that it has agreed to a debt for equity deal with its creditors. Four Seasons has over 400 homes across the UK in which it cares for its charges. This agreement marks the end to one of the longest running restructurings of debt since the start of the current recession.

The deal will reduce the company’s debt from £1.5 billion to £780 million through a trading of debt for equity in the company. This means that the largest shareholder in the Four Seasons will be the Royal Bank of Scotland thanks to the amount of the company’s debt it has been holding. The agreement means the bank will own 40% of Four Seasons.

According to top executives at Four Seasons, the company will begin working toward a long range solution to paying off its remaining £720 million debt. This is crucial because that debt comes to maturity in September 2010.

In 2006, Four Seasons was purchased by Three Delta, a Qatari-backed investment fund. Three Delta paid £1.4 billion in a complicated arrangement that involved securitisation, 11 tranches of debt and a syndicate of lenders including over 30 parties.