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upwards only rent bill (over £240m on its 750 properties) margins declined significantly creating pressure to pay landlords. With public spending cuts leading to fewer referrals (and a drop in occupancy rates from 92% to 84%), it was forced into negotiations with its landlords for rent reductions and appealed to the government for support. In early June 2011 it was announced that the company had made its own decision to withhold 30% of rent owed to avoid mass care home closure. Experts warned of a possible collapse into
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In 2007 and 2008 the
Blackstone management team left and were succeeded by a new team led by William Colvin. However cracks soon began to appear and in early 2011 the company was in crisis as a direct result of an 8% reduction in occupancy. This equated to a decline in income of circa £52m. Given its
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services, predominantly through the provision of care centres for elderly and some younger people. The group was the largest provider of care homes and long term care beds in the United
Kingdom, operating over 750 care homes, 37,000+ beds and employing around 41,000 staff. Following rapid expansion
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The company was founded in 1996 by John
Moreton, who was its chairman and chief executive until 2002. By 2002 "...it had 140 homes, was the third-largest of its kind in Europe and was heading for the stock market". In August 2002, the management backed by West Private Equity and Healthcare
235:. Blackstone denied responsibility, stating that the company had been in good order when it sold it five years previously and reaffirmed the 8% reduction in occupancy combined with an 11% increase in management overheads created the cash flow crisis.
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strategy. Southern Cross
Healthcare continued as a pure operating company, renting care homes from a number of landlord companies, including NHP which became its largest landlord. NHP was subsequently sold to investors.
262:'s ruling in 2013 found that 19 deaths at Orchid View were unexplained, but stated that under Southern Cross' former management the home was "mismanaged and understaffed", and rife with "
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By July 2011, attempts to rescue the company had failed, and all care homes were being taken over by their landlords. The largest landlord, NHP, owning 250 Southern Cross homes, hired
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financed by the sale of leases of its homes, its shares fell 98% from early 2008 to early 2011, reducing its market value from £1.1bn to around £12m. It was listed on the
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followed, for £162m. Blackstone then acquired care home owner NHP (Nursing Home
Properties) for £564m, which saw a competition investigation by the
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209:. Its shares had already fallen 98% from early 2008 to early 2011, reducing its market value from £1.1bn to around £12m.
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177:. In November 2005, it also took over the Ashbourne Group of care homes, comprising 10,000 beds in 193 homes, for £85m.
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was held. Managers closed the home in 2011; it was later renamed and reopened under new management.
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153:. The company had severe financial problems in 2011 and declared insolvency the following year.
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In
September 2004, a secondary buy-out of the business by the management together with
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Orchid View inquest: Home riddled by 'institutional abuse', BBC News, 18 October 2013
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Will this man finally manage to bring his software venture to AIM’s altar?
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of residents. The case had come to the notice of the authorities due to a
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Southern Cross's incurably flawed business model let down the vulnerable
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Media criticism focused on the split from the landlord entity, as the
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Late in 2011, two staff at the company's Orchid View care home in
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Blackstone continued to grow the business under its pre-existing
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Investments
Limited, acquired Southern Cross through an £80m
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Southern Cross slashes rent to avoid mass care home closure
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Brussels refers
Blackstone bid for NHP homes to UK watchdog
603:"Southern Cross shareholders told of NHP role in closure"
655:"Southern Cross chief stands down with no severance pay"
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Companies formerly listed on the London Stock
Exchange
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Orchid View inquest: Care inspectors' actions defended
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Southern Cross
Healthcare (United Kingdom) companies
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Blackstone prepares £1bn flotation of Southern Cross
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Blackstone denies blame for Southern Cross's plight
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250:, were arrested on suspicion of ill-treatment and
231:had crippled Southern Cross with an unsustainable
709:Orchid View care home staff arrested over neglect
577:"Southern Cross landlords to take over all homes"
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766:Families hear of abuse and neglect at care home
653:Hawkes, Alex; Brindle, David (31 August 2011).
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188:In July 2006, the company was floated on the
454:Blackstone prepares to float care home giant
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792:Health care companies established in 1996
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797:British companies disestablished in 2011
490:"Is there still life in Southern Cross?"
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377:. Companies House. Company No. 05328138
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768:, BBC News index page, 18 October 2013
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812:British companies established in 1996
627:Wachman, Richard (4 September 2011).
375:"Southern Cross Healthcare Group plc"
140:was a private provider of health and
138:Southern Cross Healthcare (Group plc)
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782:Nursing homes in the United Kingdom
757:Southern Cross care homes: the list
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807:Social care in the United Kingdom
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575:Wearden, Graeme (11 July 2011).
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324:Southern Cross chairman quits
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699:, The Guardian, 16 July 2011
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516:"Old, sick – and homeless?"
298:Southern Cross Healthcare,
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171:Blackstone Capital Partners
57:; 28 years ago
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514:Olga Craig (5 June 2011).
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264:institutionalised abuse
309:, accessed 16 May 2011
305:2 October 2011 at the
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227:strategy continued by
175:Office of Fair Trading
130:www.schealthcare.co.uk
111:health and social care
73:20 June 2012
418:NHP agrees £564m sale
190:London Stock Exchange
147:London Stock Exchange
151:FTSE Fledgling Index
268:Serious Case Review
242:Orchid View inquest
117:Number of employees
81:(insolvency agreed)
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546:, 7 September 2006
426:, 30 November 2004
225:sale and leaseback
182:sale-and-leaseback
164:management buy-out
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94:Headquarters
33:Company type
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750:grouped at
664:6 September
638:6 September
612:6 September
586:6 September
142:social care
776:Categories
381:31 January
356:31 January
286:References
214:Chai Patel
98:Darlington
89:insolvency
77:2012-06-20
476:The Times
405:The Times
544:BBC News
303:Archived
300:About us
274:See also
108:Services
260:coroner
252:neglect
200:Closure
157:History
126:Website
75: (
70:Defunct
60: (
52:Founded
43::
525:5 June
499:5 June
218:HC-One
37:Public
266:". A
666:2011
640:2011
614:2011
588:2011
527:2011
501:2011
383:2018
358:2018
258:. A
86:Fate
62:1996
55:1996
45:SCHE
41:LSE
778::
682:,
657:.
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605:.
579:.
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551:^
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102:UK
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39:(
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