good or bad - very high risk now ?14 Jun 2011 08:35
Landlords of the care homes operated by the stricken Southern Cross Healthcare Group have drafted in a leading City firm ahead of a crucial meeting today which could determine the company's future.
I have learned that the landlords committee, which meets later this afternoon, has appointed AlixPartners, a restructuring specialist, to advise it on a looming overhaul which could see Southern Cross shed hundreds of homes to rival operators.
I understand that a statement will be made after the meeting finishes this evening, with talks scheduled with the Department of Health and Southern Cross's lending banks later this week.
The appointment of AlixPartners is significant because it underlines the extent to which Southern Cross's fate is rapidly being removed from its own hands.
If the landlords do agree to a consensual restructuring, then it's conceivable that a smaller Southern Cross will emerge in the months ahead.
But if that doesn't prove to be a viable scenario (and there are plenty of stakeholders who believe from a financial - if not public relations - perspective that they ought to force the company into administration) then whatever the company says, a smooth transition will be tricky manage.
And that will mean that Southern Cross - and the stories of thousands of its concerned care-home residents - will continue to figure prominently on the news agenda for some time to come.
Southern Cross and AlixPartners declined to comment.