THE owner of one of Britain’s largest nursing-home operators is preparing a £1 billion refinancing of its business.

Allianz Capital, the private-equity group, has hired Dresdner Kleinwort Wasserstein, the investment bank, to oversee the refinancing of Four Seasons Health Care, which it acquired for £775m less than two years ago.

The refinancing, which could be followed by an auction or flotation of Four Seasons’ operating business later this year, is likely to be based on an extensive sale and leaseback of the group’s property portfolio.

Four Seasons runs 440 homes and a chain of psychiatric hospitals across Britain and employs more than 21,000 people. The company is headed by chief executive Tony Heywood, former boss of Westminster Healthcare, which became part of Barchester at the end of 2004.

As well as the original buyout by Allianz, Four Seasons was bolstered by the acquisition of Better Care from 3i last June for £116m.

Allianz’s plans have emerged amid a continuing flurry of activity in the care-homes sector. Last weekend, The Sunday Times revealed Blackstone, the private-equity group, is plotting a flotation of Southern Cross.

Buyout groups are attracted to the sector because it offers stable cashflows, buoyed by demographic trends that mean a growing proportion of the population is relying on nursing care.

But the big profits have come from the soaring value of the property estates. Allianz is one of the big beneficiaries of this trend and it stands to bank a big profit. However, a number of its homes are tied up in securitisation deals and it will have to pay a fee to extricate itself.

As well as Blackstone, which runs a care-home portfolio comprising 28,000 beds, leading operators include Bupa and Barchester, which is owned by the Irish racing tycoons John Magnier and JP McManus.

Analysts predict that both Barchester and General Healthcare Group, owned by BC Partners, will change hands this year. Although the sector is fragmented, with Southern Cross claiming a market share of only about 6%, deals between the leading players can be fraught with difficulty because of concerns about local price monopolies.

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