LONDON (Alliance News) - Social care services provider CareTech Holdings PLC on Friday said it has struck a ground rent deal to raise GBP30.0 million to support its growth plans.
The company has struck a deal with funds managed by Alpha Real Capital LLP under which the freehold to 41 properties owned by CareTech will be transferred to Alpha's funds for GBP30.0 million in cash.
The deal will release a significant amount of cash to invest, CareTech said, whilst maintaining a "virtual freehold" on the properties.
"Ground rent transactions are new to the care sector but have been used extensively in the hotel and leisure industry and we have worked closely with the Healthcare Team at Knight Frank to achieve this excellent outcome for our shareholders," said Executive Chairman Farouq Sheikh.
"We look forward to deploying the funds raised and have already identified a number of potential earnings-enhancing acquisition opportunities, which we believe will meet the evolving requirements of care commissioners along with our own growth criteria," Sheikh added.
Shares in CareTech were up 4.9% to 246.00 pence at the open on Friday.
By Sam Unsted; samunsted@alliancenews.com; @SamUAtAlliance
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