Mid-market UK private equity firm Bowmark Capital has backed the GBP75m buyout of Healthcare Homes, an elderly residential care provider in eastern England, in a secondary private equity t
Mid-market UK private equity firm Bowmark Capital has backed the GBP75m buyout of Healthcare Homes, an elderly residential care provider in eastern England, in a secondary private equity transaction from August Equity.
The buyout team is led by chief executive Richard Clough, whom Bowmark partners know well through previous successful investments including learning disability care provider the Regard Partnership, drug and alcohol testing services group Medscreen, and health and social care provider Care UK.
The management team includes finance director Graham Lomer and operations director, David Bates. Like Clough, both previously worked at Care UK and have more than 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 in Suffolk, Norfolk, Cambridgeshire and Bedfordshire.
Bowmark says 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, the private equity firm says, 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,’ Clough says.
Adds Bowmark partner Kevin Grassby: ‘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 private-pay business with national coverage.’
Bowmark is investing GBP35m of equity funding for a significant majority interest in the company. Royal Bank of Scotland is leading a GBP40m 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.
Grassby and Bowmark partners Mark Salter, Ron Pearson and David Torbet managed the investment process. This is the first investment from Bowmark’s latest fund, Bowmark Capital Partners IV, which closed with GBP265m in capital commitments in January.
Founded in 1997, Bowmark Capital specialises in smaller UK companies and manages and advises funds totalling some GBP700m on behalf of an investor base including public pension funds, insurance companies and banks from the UK, US and continental Europe. The Bowmark team has supported more than 50 businesses across a range of industries including business services, leisure, healthcare, media and IT services.
