Companies providing homecare have come under increasing financial pressure as local government budgets are squeezed due to the recession and cutbacks.
Homecare companies provide an enormous range of services to the sick and elderly so that they can stay in their own home – their importance to the community and budgets cannot be over-estimated. Services range from providing someone to bathe and dress you, to just someone popping in to do the weekly shop.
These companies provide vital support to the sick and elderly so that they can remain in their own homes. Without these services, the pressure and costs of running community health centres and hospitals would rise considerably.
One such business was the independent homecare provider, Prestige Homecare Limited, which provided a wide range of care services with a package tailored to the individual needs of people living in their own homes.
When the company began to accrue substantial debts including an amount to HMRC, it was forced to call in the administrators – SFP, the nationwide insolvency practitioners.
The Director looked at every possibility before deciding that, because of the effect of the reduction in local council funding, that there was no option other than seek immediate protection from pressing creditors and place the company into administration,” says Simon and Daniel Plant, Directors at SFP.
“We recognised the importance of the survival of homecare organisations has in particular and sensitive situations where the sick and elderly are dependent on homecare for their well-being.
“The rescue of any company is a priority. Our priority was that the company would continue as a going concern and that there would be no service interruption for homecare patients,” adds Daniel.
The owner of Prestige had been working in the caring industry for over 20 years. Initially he set up Prestige as a sole trader using his own personal funds with his wife. After only a year, Prestige had many contracts including one with a local council which enabled it to relocate to new premises in Stalybridge, Cheshire and employ more staff.
When the company went into administration it had an annual turnover of over £750,000 and a workforce of 58 people, but with local council budgets constraints, it reluctantly entered into administration.
In order to secure the sale it was first necessary to establish that the major contracts with two key councils would continue. From the council’s perspective, its concern was the continuity of care for patients, and after lengthy discussions and reassurances that staff would be retained, the councils agreed in principle to continue working with the company after the sale was completed.
Having secured the initial commitment of the Councils, the next step was to implement a wide-ranging employee communications programme that would reassure staff. Any disruption to service provision would have jeopardised the completion of the business sale, and threatened the quality of care for the end user.
After carrying out its review of the position against the clock, SFP was able to arrange a successful sale that ensures the security of jobs for people working at Prestige and, most importantly, the provision of homecare services in the community.
“It is pleasing to report that a sale was subsequently achieved that will ensure the provision of such important homecare services to the sick and elderly in their homes as well as the preservation of jobs for Prestige staff,” Daniel concludes.