Albion Ventures has sold Nelson House, a mental health rehabilitation hospital, to a joint venture formed by Care UK and Sussex Partnership NHS Foundation Trust for GBP8m.
The transaction is the first to involve a joint venture between the NHS and a private healthcare provider to acquire a hospital.
A new hospital, Nelson House opened in May 2012 and was backed by Orchard Portman Hospitals and Albion Ventures. As a result of the sale funds managed by Albion have generated a GBP2m profit, equating to a return of approximately 1.4x their investment and an IRR of 18.3 per cent in under two years.
Albion, in conjunction with its management team Orchard Portman Hospitals, identified the South Coast as an area of under provision for independent mental health hospitals specialising in rehabilitation in the community – so called step down care. As a result the firm invested GBP4.9m in March 2011 to fund the creation of Nelson House.
The hospital offers care and treatment to male patients aged 18 to 65 as they continue their recovery and aim towards independent living. All patients are paid for by the NHS and come from NHS hospitals as well as private mental hospitals used by the NHS.
David Gudgin, partner at Albion Ventures, says: “We could not be happier with the success of Nelson House. We have enjoyed partnering with the superb management team at Orchard Portman in creating a first class facility that addresses an urgent need for high quality step down care. We are confident that other similar opportunities exist in this sector as the NHS looks to form additional private sector partnerships and look forward to continuing our involvement in this area. This investment has generated an excellent return for our funds and underlines our sustained ability to identify growth opportunities in the healthcare sector.”
Oliver Sargent, the chief executive of Orchard Portman Hospitals, says: “I am very proud of what we have achieved at Nelson House. The building is exciting and the staff team excellent. We know the service will continue to innovate and meet local needs under its new ownership. Personally I would like to thank David Gudgin and Albion Ventures for their vision and support from our first meeting all the way to this sale.”
There will be no redundancies at Nelson House as a result of this sale.
