| Borrower | Ashberry Healthcare Ltd (management team) |
| Locations | Seven care homes across Surrey, Cheshire, Herefordshire and Carmarthenshire |
| Registered beds | 320 |
| Care type | Nursing and residential dementia care for elderly residents |
| Loan type | Commercial mortgage, MBO facility |
| Loan amount | £5,000,000 |
| Lender | Cambridge & Counties Bank |
| Purpose | Management buyout of the business from existing shareholders |
| Broker fee | None |
The situation
Ashberry Healthcare operates seven care homes with 320 registered beds across Surrey, Cheshire, Herefordshire and Carmarthenshire. The group specialises in nursing and residential dementia care for elderly residents and was established in 2003.
The senior management team, led by Managing Director Nigel Denny with over 25 years of sector experience, wanted to acquire full ownership of the business through a management buyout. The team included Susan Lovelace as Operations Director, a registered nurse with eight years of senior operational experience, and Gary Cottrell as Finance Director with over ten years in healthcare finance.
The management team had been running the homes operationally for years. They knew the business, the staff, the residents and the local authority relationships inside out. What they needed was the right funding structure to turn operational control into ownership.
The challenge
Care home MBOs carry specific complexity that standard commercial mortgage applications do not. The lender needs to assess not just the property portfolio but the sustainability of the business under the new ownership structure. With 320 beds spread across four counties and two countries (England and Wales), the underwriting required a lender comfortable with multi-site healthcare portfolios and the regulatory differences between CQC (England) and CIW (Wales).
The management team's strength was their operational track record, but lenders still needed to see that the group's EBITDA could service the debt while maintaining the staffing levels, care standards and capital investment that CQC-regulated homes require. A care home group running at thin margins after an MBO is a risk no specialist lender will take.
How we structured the deal
We presented the case to specialist healthcare lenders with appetite for multi-site care home portfolios. Cambridge & Counties Bank was the right fit: they understood the healthcare sector, had experience funding MBOs, and could underwrite against the group's established trading performance rather than requiring the management team to prove themselves as if they were first-time operators.
The £5 million facility was structured to fund the buyout while preserving enough working capital headroom for the group to continue investing in its homes. The management team's combined 40+ years of healthcare experience, strong CQC ratings across the portfolio, and stable occupancy levels gave the lender confidence in the long-term serviceability of the debt.
No broker fee was charged. On a £5 million facility, that represented a material saving for the management team at a point where preserving capital was critical.
The management team
The strength of the management team was the cornerstone of this deal. Nigel Denny brought over 25 years of direct care sector experience. Susan Lovelace, a registered nurse, had eight years leading operations across the group. Gary Cottrell had spent more than a decade in healthcare finance, meaning the financial controls and reporting were already in place to the standard lenders expect.
This matters because care home MBO finance is assessed differently from a standard acquisition. When the buying team has been running the homes, the lender can see exactly what they are underwriting. There is no uncertainty about whether the new operator can maintain CQC ratings, occupancy or staffing quality. The track record is already proven.
The outcome
Cambridge & Counties Bank provided £5 million in MBO funding for Ashberry Healthcare. The management team took full ownership of the 320-bed, seven-home group, securing the long-term future of the business and the care of its residents. The deal was arranged by FD Commercial with no broker fee.
Frequently asked questions
What is a care home management buyout?
A care home MBO is a transaction where the existing management team acquires ownership from the current shareholders. It is funded through commercial mortgage finance secured against the properties and equity from the management team. MBOs are common in the care sector when investors exit or founders retire.
How do lenders assess a care home MBO?
Lenders assess group EBITDA, CQC ratings across all homes, occupancy levels, fee income mix, and the management team's operational track record. The team's proven ability to run the homes is a significant positive in underwriting.
Can a care home MBO be funded with no deposit?
In most cases, the management team needs to contribute equity. However, on strong MBOs with excellent CQC ratings and long trading histories, the equity requirement may be lower. Vendor loan notes can also reduce the upfront equity needed.
How long does care home MBO finance take to arrange?
Typically 10 to 16 weeks from formal application to completion. MBOs involve more legal complexity than straightforward acquisitions, including share purchase agreements and management warranties.
Does FD Commercial charge a broker fee for care home MBO finance?
In most cases, no. FD Commercial is paid by the lender on completion. Where a borrower fee applies, it is agreed and disclosed in full before any work begins.
All rates and terms are indicative and subject to individual assessment, lender criteria and property valuation. Your property may be repossessed if you do not keep up repayments on a mortgage or any other debt secured on it.
Care home finance from £1 million. No broker fee in most cases.
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