Cooney sells Canford to US firm Ventas in €75m deal
Published 26/04/2015 | 02:30
Serial entrepreneur Brian Cooney has sold his Canford Healthcare business to €20bn valued US property group Ventas in a €75m deal.
Under a complex agreement, the Tipperary man will continue to run the high end nursing home operation and will have an ambitious acquisition plan also financed by Ventas.
Cooney raised close to €20m from Irish investors assembled by NCB (now Investec) to create the Canford Healthcare buyout vehicle in 2007. Backers included former SIAC boss Finn Leyden, who also joined the board of Canford Healthcare.
Plans to buy up to 10 private nursing homes in the South East of England were disrupted by the financial crisis, with Canford Healthcare ultimately buying just five homes.
Last September, Investec Corporate Finance was appointed to advise Canford Healthcare on strategic options, including the sale to trade players or specialist financial institutions.
US real estate investment trust Vestas agreed to buy Canford in a sale and leaseback deal, which saw the company split into a property company and a separate entity to operate the business. This was because real estate investment trusts (REITs) cannot buy trading businesses and can only acquire property assets.
Cooney and his partners have committed to a long-term lease of the homes, with Ventas agreeing to bankroll an acquisition spree that could see the group buy up to 20 care homes in the south-east of England. Apart from Investec Corporate Finance, Charles Russell Speechly also advised Canford Healthcare. JLL Corporate Finance advised Ventas, with law firm Berwin Leighton Paisner also acting for the US company.
Investec's private clients are also believed to have doubled their money on the investment, receiving close to €40m from the deal. The NCB private clients had initially invested a minimum of €150,000 each with a seven year time span before a return.
Canford Healthcare was to be sold or floated on stock markets after that time.
Cooney and his co-founders also sharing in the upside. They initially inked a kicker deal which saw them share 20pc of the profits if the annual return to investors hit 15-20pc. Proceeds from the buyout were used to repay debt owed to Bank of Ireland and Santander, which had been deployed to buy the nursing home portfolio.
The Canford deal is the second major exit for Cooney. The 49-year-old Rockwell College deal-maker set up water cooler company All Water Systems in 1990. Over the next decade he built the firm into the biggest player on the Irish market with a 70pc share of the "point of use" sector before selling out to PHS Group in 2003.
Cooney is thought to have netted around €7.5m from the sale. Along with his partners he re-invested around €1m in the Canford Healthcare business.
Cooney's move to target the lucrative UK private nursing home business mirrored that of other wealthy Irish businessmen. John Magnier and JP McManus are backers of the Barchester Healthcare chain, which is one of the largest private nursing home operators in Britain.
Former Kerry Group boss Denis Brosnan and his Lydian Capital private equity group bought the Castlebeck private hospital chain in 2006 for around €330m.
Sunday Indo Business