A CARE home group will not automatically be sold after one of its backers rejected proposals to restructure its massive debts.

The lender’s rejection of the proposals for Four Seasons Health Care’s £1.5bn debt was described as “manoeuvring”

last night.

Four Seasons owns and operates 52 care homes in the region and employs about 200 people at its offices at Lingfield Point, Darlington.

It said last week that if its creditors were unable to reach agreement by July 6 on the restructuring proposals put forward, then the focus should be shifted to selling the group.

The situation is complicated by the fact the company has a complex 11 tiers of debt and 35 creditors with vastly different stakes in the business.

The restructuring plan was put forward last week by Hatfield Philips International, a financial trustee that represents Four Seasons’ senior creditors.

Yesterday, it emerged that one group of smaller lenders, while supporting a restructuring of the group in principal, had found the terms put forward unacceptable.

Four Seasons made no comment last night, but a source close to the situation told The Northern Echo that it appeared to be a tactic to try and get “a larger piece of the pie”.

The source said: “There is behind-the-scenes manoeuvring by one group of lenders. They are in effect saying they want more.”

The source said that if instead of accepting restructuring, the smaller lenders sought to enforce their “security over assets”– a process to get their money or assets from Four Seasons – the business would head towards administration, decimating their investment.

The source said: “If the smaller lenders were to seek to enforce their security over the assets, which they have not done, that would damage the position of the larger lenders.

“However, it wouldn’t be rational because although the big lenders wouldn’t get as much, the smaller lenders would get nothing or close to nothing.”

The source added: “It hasn’t actually changed the situation at the moment. They have said the terms aren’t acceptable, but the fact remains there is the restructuring proposal on the table and the lenders have until July 6 to come back to Hatfield Philips.”

The plan put forward last week would roughly halve Four Seasons’ debt and give half of the company’s equity to a group of senior lenders, including the Royal Bank of Scotland, Fortis and Nationwide.

The balance of the shares would be split among the rest of the creditors.

Despite the uncertainty, which comes after almost a year of negotiations, Four Seasons has repeatedly said there was virtually no chance that homes would be closed or residents forced to move. It runs 400 care homes, caring for 15,000 people.