April 28, 2021 – Welltower’s £570 million unitranche debt facility and an accompanying equity injection from Safanad and Welltower has resulted in the deleveraging of HC-One’s balance sheet, creating a streamlined capital structure and providing the company significant financial flexibility going forward. Most importantly, this recapitalization provides HC-One ample liquidity to invest in improving its facilities, enhance the resident experience, and to expand its operating and technology platforms.
HC-One is the UK’s largest senior care provider with 19,394 beds in 327 facilities housing over 15,000 residents and providing a wide range of care services to the nation’s elderly population. We believe HC-One’s experienced team and nursing staff have and will continue to perform remarkably throughout the pandemic; their dedication and professionalism have allowed the Company to emerge in a position of strength. The Company’s comprehensive business plan will include adequate capital to refurbish approximately 216 of its homes, continue its ongoing new build program which will bring a new generation of purpose-built care homes to more communities throughout the UK, raise wages for care providers who have been on the front lines throughout the pandemic, and provide a revised incentive scheme for the HC-One management team.
Welltower funded £540 million on April 27th 2021 through their existing balance sheet liquidity. An additional £30M delayed draw facility will be available from Welltower for future capital expenditures and working capital needs at HC-One. Additionally, Welltower committed £55 million of equity investment alongside Safanad’s further commitment of new equity. Court Cavendish, led by Dr. Chai Patel, also participated in the transaction by investing further equity in the Company. Safanad’s new equity investment will result in Safanad becoming the controlling sponsor and majority owner to further enhance our leadership of HC-One’s governance going forward.
Safanad believes this recapitalization is particularly well timed, as macro tailwinds for this essential business continue to drive the need for a greater supply of safe and well-managed care facilities. We believe HC-One’s streamlined capital structure will allow it to focus on its capital expenditure program, further enhancing the quality of its homes, and strengthening its position as the UK market leader. With ownership of 85% of the real estate which HC-One operates, we believe the Company can confidently invest in its facilities and other growth opportunities to help accelerate recovery and growth of occupancy. We trust that the partnership with Welltower as one of the world’s leading public healthcare and senior housing owners will strategically position the Company to capitalize on consolidation opportunities and gain further market share.
Safanad is especially proud of the role HC-One plays in communities across the UK and strongly believes that this now very well-capitalized business will continue to deliver excellent outcomes for all stakeholders and exciting future growth.