The Southern Cross Healthcare Fiasco

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LATEST NEWS ON SOUTHERN CROSS

Southern Cross Collapses

11 July 2011

Southern Cross (SCH) have effectively collapsed.

SCH runs over 750 care homes, with 31,000 residents being cared for by about 40,000 staff.

After a series of financial disasters, SCH tried to get a deal done with its landlords which appears to have failed.

Southern Cross therefore issued a statement to the London Stock Exchange & the Financial Services Authority at 7.30 am today London time.

[More & Official Statement]

UK CARE HOMES CRISIS: Southern Cross Fiasco Only The Tip Of The Iceberg

Insolvencies in the health and social care sector are up by 49% in the first half of 2011

How close has the Government come to being care provider of last resort?

The well-publicised and spectacular fall from grace of Southern Cross hides a much deeper problem within the whole of the care sector.

[More]

Southern Cross Investors Video

The continuing saga of Southern Cross Healthcare group (SCH) should need no introduction.

It has been broadcast all over the world, not just in the UK. Everybody is now aware of what a disaster SCH has become.

[More & Video]

Magic Circle Rivals Aim To Ease Southern Cross Financial Pain

Large British Law Firms Start Advising Over Southern Cross Financial Mess

By Husnara Begum of The Lawyer Magazine

Clifford Chance, Eversheds, Freshfields Bruckhaus Deringer and Lovells have all scooped roles to help Southern Cross Healthcare secure a rescue package that will prevent the stricken care home operator from going into administration.

The UK’s largest care home group, which unusually for the sector does not own any of its 753 properties, can no longer afford to pay its rent because of slower-than-expected rises in fees from local authorities.

[More]

Blackstone Calls For Help From PR Firm Finsbury In Southern Cross Care Crisis

The Blame Game: The GMB union protesting against giant equity group Blackstone

By Alec Mattinson of PR Week UK

The world's largest private equity group Blackstone has drafted in international public relations firm Finsbury to fight media headlines blaming it for the Southern Cross fiasco.

[More]

British Trade Union Releases Devastating Report On Southern Cross Fiasco

A British trade union has published a report on the goings-on at care homes provider Southern Cross Healthcare (SCH).

The GMB union, which represents approximately 11,000 of SCH's 41,000 workforce, has been at loggerheads with the company for several years over its poor treatment of staff members. For the past 2 years it has been looking into the affairs of the company along with its financial problems, and at the opening of its annual general conference (Congress Meeting) being held in the English south coast resort of Brighton, revealed the results of its investigation.

Entitled "The Cross We Have To Bear - The Greedy & The Gullible", the 61 page report details that big British & American financial institutions were involved in the now controversial "sale and leaseback" of SCH's property portfolio. This resulted in the then owners of SCH, wealthy private equity group Blackstone, orchestrating and continuing this policy leading up to the Initial Public Offering (IPO) floatation of the groups shares on the London Stock Exchange making a killing in the process for the investors and the then directors.

It details that many of those who organized the mess that is the care sector in private hands, are still in senior jobs in the City employed as highly paid financial experts, and the GMB feels it necessary to expose the reality that the bankers/financiers involved, and the investors who bought the shares, were either greedy pigs or gullible fools.

[More, Report Details & Link To Full Report]

Southern Cross Healthcare Panic Call Of Investors Meeting

6 June 2011

Southern Cross Healthcare (SCH), the largest British care homes provider which has been at the center of a corporate fiasco as a result of a ruinous sale and leaseback deal, has been forced to call a meeting of investors as its share price has collapsed.

[More]

Southern Cross Healthcare: Problems & History

The UK's largest operator of care homes is in serious crisis and panic is starting to set in with the worry of what would happen if they went bankrupt.

The prospect of over 30,000 of its residents, mostly elderly, mentally ill and disabled people being forced to wander the streets in bedclothes while the liquidators close all of Southern Cross Healthcare's (SCH) 700+ homes and 41,000 staff being let go is getting major news in Britain and seems to be getting politicians worried.

With many of its staff being Filipino, this is a worry for the Philippine community in the UK. It is also telling that the blame game is being played out at a high level, added to which a strategy is being played by SCH of who can blink first.

[More]

Former Southern Cross Bosses Made A Fortune: But Residents & Staff Are Left To Bear The Results

The people behind the original fortunes made at Southern Cross Healthcare (SCH) have left after having dumped their shares at the top of the market. These, along with private equity firm Blackstone saddled SCH with today's debts on the sale and leaseback program.

They got out and are amassing property empires, not so the residents of SCH and the staff who are mostly on minimum wages.

[More]

Southern Cross Landlord Four Seasons Loses Half Of Its Rent

Struggling care home operator Southern Cross withheld more rent from one of its biggest landlords than initially thought in order to stave off bankruptcy, the Daily Mail has learned.

[More]

Southern Cross To Shed 180 Care Homes To Survive

Embattled care home provider Southern Cross Healthcare is to shed nearly a quarter of its homes as its struggles to stave off bankruptcy, reports the Telegraph.

[More]

The Financial Lessons Of Southern Cross

Any kind of overhead that is fixed or rising, at a time when revenues are under pressure, can bring down a business, says BBC business editor Robert Peston.

[More]

The Billion Pound gamble of the care home sharks revealed: Southern Cross predators sold off almost 300 homes to RBS

The full extent of U.S. private equity firm Blackstone's profiteering at the expense of the elderly and the vulnerable at Southern Cross laid bare today.

[More]

Southern Cross Investors: Having Your Jam Today Can Prove Bittersweet

It was all the rage several years back for companies from pub groups to supermarkets to sell off their property, pocket the proceeds (or hand them to shareholders), then rent it back, says the UK's Financial Times.

Describing how investors piled into Southern Cross without looking at the deals done, they have left themselves as well as pension funds nursing a large headache.

[More]

Southern Cross Care Fiasco Sheds Light On The Secretive World Of Private Equity

When Debenhams was taken over by private equity in the boom years of the noughties, its executives sold off freehold properties, cut costs, and loaded the business with Ł1bn in debt, before trebling their money by floating it on the Stock Exchange.

They made money, the business itself is still struggling loaded down with debt.

[More]

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