Cork-based investments firm BlackBee Group, led by founder and chief executive David O’Shea, is preparing to lead a €100 million bid for the 12 operating nursing homes and two under development in its healthcare fund, according to sources.
It follows an attempt to sell the portfolio to a European fund and is part of a wider restructuring of the group that saw Blackbee agree this month to sell its book of regulated investments, with €250 million of assets under management, to UK-based Aria Capital Management.
The planned bid for the nursing homes, being co-funded by a small group of investors and bank debt, would see investors in the homes, by way of fixed-interest bonds, being redeemed at par and receiving any interest due. The small number of equity investors in some of the properties will be offered a chance roll over their investment into the planned bid vehicle, the sources said.
The portfolio currently about 790 beds, which will rise to over 1,000 next year on completion of the two planned homes.
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BlackBee, which was founded in 2014, accumulated the nursing home assets initially by investing in the Ditchley group of homes with facilities in counties Cork and Clare and then under the Aperee franchise, headed by chief executive Paul Kingston. BlackBee took over the management company involved in the Ditchley homes two years ago and gave the contract to Aperee.
BlackBee hired PwC a year ago to find a buyer for the nursing homes. However, talks with a European investment fund hit a hurdle when Mr Kingston and Aperee’s chief financial officer, Hazel O’Connor, asserted they had a 40 per cent interest in various Aperee companies. The dispute ended up before the High Court in May, but was subsequently settled.
BlackBee indicated to investors recently that while it has sought to resuscitate a deal with the European fund over the summer, rising interest rates and global inflation has meant it such a transaction would be unlikely to proceed.
“Aperee will continue as one of the largest operator of nursing homes in Ireland. It is an important part of a sector that more than ever requires private investment and funding,” Mr O’Shea said in response to questions from The Irish Times, declining to comment the bid plan. “We will be reorganising the portfolio and operations over the coming weeks and will look to broaden our focus to acquire or partner with some of those homes that are being forced to closed.”
Following the sale of BlackBee’s investments to Aria, Mr O’Shea plans to set up a small trading fund, financed by a small number of private investors.
Assets under management in the BlackBee Investments have fallen from a peak of €450 million under management to €200 million over the past two years, after the company indicated to clients at the start of the Covid pandemic that it would be winding down operations and reorganising its portfolio, amid rising regulatory and compliance costs.
The number of clients has fallen from 4,000 to 2,500 over that period.
Aria is expected to use the purchase of the book to develop its exiting Irish business. BlackBee will retain its existing Central Bank investment firm authorisations for the next 18-24 months as the group is being reorganised.
It is expected that the about €45 million of equity that Blackbee clients hold in iNua Hospitality, a chain of hotels in regional Irish cities, will also be refinanced in time.
