CareTech raises £32.6m from sale and lease back of properties
Source - SMW
Social care services provider CareTech Holdings said it had raised £32.6m to support its growth through a rent agreement with funds managed by Alpha Real Capital.
The deal would see the freehold interest in 24 of CareTech's properties transferred to Alpha.
CareTech would get security of tenure with a 150-year lease term, which it said equated to a 'virtual freehold interested' in each property.
The starting rent would be £1.0m per annum, which would rise with the UK retail price index on a yearly basis between 0% and 5% per annum.
'The transaction releases a significant amount of cash for reinvestment in growth opportunities whilst in the near term it will reduce borrowings,' CareTech said.
'There is no requirement to pay off any existing bank debt as a result of this transaction,' it added.
At 2:31pm: (LON:CTH) CareTech Holdings PLC share price was +5.5p at 337.5p