Bowmark Capital backs £75 million buyout of Healthcare Homes

The buyout team is led by Chief Executive, Richard Clough, whom Bowmark partners know well through previous successful investments including: The Regard Partnership, the learning disability care provider; Medscreen, the drug and alcohol testing services group; and Care UK, the health and social care provider. The management team includes Finance Director, Graham Lomer, and Operations Director, David Bates. Like Clough, both previously worked at Care UK and have over 20 years’ experience in the residential care sector.

Healthcare Homes provides high quality nursing, residential and day care services to the elderly and to younger adults with physical disabilities, with an emphasis on inclusive activities to enhance the residents’ quality of life. It owns and operates 21 care homes with more than 800 residential beds and 200 day-care spaces. The properties are expansive period homes based in Suffolk, Norfolk, Cambridgeshire and Bedfordshire.

The number of elderly people needing residential care in the UK is set to grow strongly, as is the demand for privately-run, high calibre accommodation, increasingly paid for by residents’ own resources. As a leading private-pay operator with a strong regional presence, Healthcare Homes is well-positioned to capitalise on these trends.

"With Bowmark’s financial support and considerable experience in the residential healthcare sector, we will pursue our strategy of growing the business through targeted acquisitions and the extension and expansion of our existing homes," says Clough.

Bowmark Partner, Kevin Grassby, explains: "The management team has a proven track record of building and running successful residential care businesses. They have already identified an attractive pipeline of potential acquisitions, and we are excited at the prospect of working with the team to build a leading private-pay business with national coverage."

Bowmark is investing £35 million of equity funding for a significant majority interest in the company. Royal Bank of Scotland is leading a £40 million senior debt facility, with further funding available for bolt-on acquisitions and developments. The management team is also rolling over a significant proportion of its sale proceeds alongside Bowmark.

This is the first investment to be made by Bowmark’s latest fund, Bowmark Capital Partners IV, which closed on £265 million in January 2008.