CARE homes provider Southern Cross tonight said it had reached an agreement which will secure the care of its 31,000 residents.

The deal, hammered out at a crunch meeting, is designed to allay fears that frail and elderly residents may suffer disruption if the company collapses.

It could also help restore confidence in the Darlington-based company, which runs 752 care homes, in a bid to stem the decline in the number of residents.

Southern Cross also said it was working towards a solution to its financial woes, which it hoped to deliver over the next four months.

However, it is expected that many of its 80 landlords will withdraw their homes from the group in the coming months to run them independently.