Cambian seeks better health with £377 million sell-off to US
Hundreds of mental health patients will transfer to a new care home operator after struggling provider Cambian sold its adult services business to an American firm for £377 million.
Cambian will sell the division, which looks after 1000 people with learning difficulties and mental health problems, to US-owned Cygnet Health Care after deciding on a restructure of the business.
The unit accounted for half of Cambian’s £290 million annual revenues. The sale shrinks Cambian to solely a children’s services provider. “We’ll be a much smaller business and the board will be shrinking in due course,” said chief financial officer Martin Hopcroft. Former Barnardo’s chief executive Anne Marie Carrie has been drafted in to help with the move.
About £40 million of the sale proceeds will be given back to shareholders, including US private-equity firm GI Partners which owns 43%. The rest will be used to pay off debt.
Cambian issued three profit warnings in six months at the turn of 2016 and has struggled since its 2014 float, suspending its dividend.
The group said it would restart the payout again once it has slashed its £250 million debt pile.
