20th Nov 2009 12:52
20 November 2009
Southern Cross Healthcare Group PLC
Sale of Freeholds
Proceeds used to further reduce debt
Southern Cross Healthcare Group PLC (LSE: SCHE) ("Southern Cross", the "Company" or the "Group"), announces the completion, on 13 November, of the sale of its freehold interests in two care homes for a total cash consideration of £12.0m, all of which will be used to reduce the Group's borrowings. The Group will continue to operate these homes under long term leases.
Westerfield, Paisley was sold to Hedgemans Limited (50%) and Handsale Limited (50%) for a cash consideration of £4.6m. The initial annual rent payable by Southern Cross in respect of this home is £365,541. The gross asset value of the freehold interest divested is £4.4m and a book profit, after related fees, of £0.1m was recognised. The proceeds from the sale were used to repay part of the Group's term loan facility which, after this repayment, has an outstanding balance of £34.4m.
Haven Lodge, Portishead, which was developed by the Group, was sold to Thrill Limited for a cash consideration of £7.4m. The initial annual rent payable by Southern Cross in respect of this home is £580,000. The gross asset value of the freehold interest divested is £7.3m resulting, after related fees, in no profit or loss being recognised. The proceeds from the sale were used to repay part of the Group's development facility which, after this repayment, has an outstanding balance of £6.2m.
Also, on 13 November 2009 the Group exchanged contracts on Wookey Hole and Cathedral View, two homes which were closed following the opening of the Group's new home in Wells in September 2008. The sale of these homes is expected to complete in November for a cash consideration totalling £0.9m. The gross asset value of the freehold interests being divested is £0.9m resulting in no profit or loss being recognised. The proceeds from the sale will be used to further pay down the term loan facility.
The Group continues to be in discussions regarding the potential disposal of its Copthorne and Faversham development properties.
William McLeish
Company Secretary
Related Shares:
-3x Short China