Sovereign leads care homes buyout

Sovereign Capital, the UK mid-market private equity firm, has completed the £22 million institutional buyout of Herts Care Group, the provider of crisis care homes for children.

Herts Care Group, the UK care homes operator, has been bought out for £22 million by Sovereign Capital. HSBC Specialised Financing provided acquisition debt and a revolving credit facility, which will be used to support the rollout of new homes.

Established in 1996, Herts Care provides crisis intervention services in specialist residential homes in England’s Northeast, Southeast Anglia and Devon. The group offers a range of therapeutic care and education services for children aged between 11 and 18 years for whom foster care, larger homes or secure accommodation are not appropriate.

In a statement, Sovereign said it sourced the opportunity directly having identified family succession issues. The firm has assembled a new management team led by Malcolm Stevens, the former head of Group 4 Falck’s Rebound children’s services business.

“The group has a first-class reputation and we have brought together a quality management team with the skills set to develop the group, enabling more children to have access to this level of dedicated care,” said Ryan Robson, director of Sovereign Capital.

The investment is the third made by Sovereign Capital in the health and social services sector this year. In April it led the £26 million institutional buyout of TRACS, a provider of specialist residential care homes for adults with mental health needs. It has also invested in PCS and SENAD, both providers of care and education to children with special needs.

Sovereign Capital invests in UK companies requiring between £5 million and £15 million of equity, and has £175 million under management.