STRICKEN care homes provider Southern Cross announced last night that it has reached an agreement to 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 if the company collapses.
It could also help restore confidence in the Darlington-based company, which runs 752 care homes across the UK, in a bid to stem the decline in 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.
It is not yet clear how many landlords, many of whom are rival care home operators, will walk away from the group, but it is expected that Southern Cross will ultimately be left a much smaller company.
A company spokesman said last night: ''At a meeting today, Southern Cross, its lenders and the Southern Cross Landlords' Committee reached an agreement to ensure that the continuity and quality of care to all 31,000 residents will be maintained and that every resident will continue to be well looked after.
''The company and the landlords will work towards a consensual solution to the company's current financial problems which will be delivered over the next four months.
''This process will be overseen by a Restructuring Committee made up of representatives of the Landlords' Committee and the company.
''The business, including the delivery of care, will continue to be the responsibility of the Southern Cross Board, management team and staff who have the full support of both the landlords and lenders in the delivery of this important task.''
Southern Cross, the UK's largest care home operator, has been struggling under a £202 million annual rent burden while its own income falls as public sector customers, such as local authorities, make cutbacks.
Southern Cross made losses of £311 million in the six months to March 31.
The company, which also runs homes under the Ashbourne Senior Living brand, has warned it is in imminent danger of financial collapse.
It recently announced it would cut its rent payments by an average of 30 per cent over the next four months to buy some breathing space.
The company, which employs 44,000 staff, recently revealed plans to cut 3,000 jobs. These include more than 300 nurses, while 1,275 care staff, 700 catering posts, 440 domestic jobs and 238 maintenance roles could also go as part of its business revamp launched 18 months ago.
The Southern Cross Landlords' Committee said earlier this week that its members were prepared to throw the stricken company a lifeline by taking significant cuts in rent. But it wanted the banks and the taxman to share some of the financial pain.
Southern Cross's main lenders are Barclays and taxpayer-backed Lloyds Banking Group, which are understood to be owed about £50 million in total. The taxman is reported to be owed £20 million by the company.
Representatives from its lenders and the Department of Health did not attend the meeting and it is not yet known how they have responded to the landlords' demands.
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