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Friday, August 07, 2009

Care Industry conundrums

Four Seasons Healthcare has been teetering on the brink of oblivion since the beginning of the recession.

Yesterday it announced that it was writing of half its £1.5 bn of debt, in exchange The Royal Bank of Scotland (RBS), and funds it manages, becomes the largest single shareholder, with about a 40% stake. To all intents purposes it controls the company, although it forcibly denies this is the case.

We now have a weird situation.

The RBS controls Four Seasons (plus a pile of other care homes) – the Government controls RBS. In parallel to these shenanigans the dire state of public spending is putting the screws on the Care Industry to reduce the cost of care and hence profit margins.

You don’t have to be a Wittgenstein to work out that this means the Government is in fact financially screwing itself.

As a marketer I have not idea what you can do with this information but it gives you cause to think.

If the Care Industry is of interest to you then you should read this article by the guy who runs BUPA Care Homes. Dick Stroud

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