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Retirement homes firm could be sold
5:53pm Monday 26th November 2012 in Business
THE UK’s biggest builder of retirement homes could be sold or listed on the stock market as part of a review of the group.
South coast-based McCarthy & Stone has appointed investment bankers at Moelis & Co to look at its future options following the recent appointment of chief executive Mark Elliott.
Mr Elliott, the former boss of Doncaster Racecourse owner Arena Leisure, joined on November 1 and the group last month revealed a sales and earnings bounce back in its best annual results since the financial crisis.
McCarthy & Stone, which sold nearly 1,400 properties in its last financial year, was taken private in an ill-fated £1.1 billion deal led by Scottish entrepreneur Sir Tom Hunter and billionaire brothers David and Simon Reuben in 2006.
A debt-for-equity swap three years later left the group 25 per cent owned by its lender, Lloyds Banking Group.
The review of the business comes ahead of a refinancing of about £500m in debt that is due by April 2014 and the company is taking the opportunity to look at its options after a recent improvement in performance.
Figures for the results to the end of August show underlying earnings rose by ten per cent to a five-year high of £39.9m after sales jumped 12 per cent to £257.7m.
On posting the figures, McCarthy & Stone chairman Alan Bowkett said the group was “starting to look at strategic options to accelerate the achievement of our goals and take full advantage of the growth in our market”.
Options being considered include a sale of the business, flotation or a refinancing.
The group was founded by John McCarthy and Bill Stone in 1963 and began specialising in building retirement homes in the 1970s.
Based in Bournemouth, it employs about 700 people.
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