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UK West Private Equity completes first exit with £162m sale of Southern Cross

UK West Private Equity has completed its first exit with the £162m sale of Southern Cross Healthcare to the Blackstone Group. West Private Equity acquired Southern Cross, which operates 139 care homes in the UK, for £90m in August 2002.

'We have enjoyed working with the management team at Southern Cross in substantially growing the business since 2002,' said Philip Buscombe, chief executive of West Private Equity. 'Although we have only owned our interest in Southern Cross for two years, the sale to Blackstone, with its substantial funds under management, will provide Southern Cross with access to additional capital so that it can participate fully in the likely consolidation of the elderly healthcare sector.'

'We believe that Southern Cross has one of the highest quality and best managed portfolios of care homes in the sector,' added Joseph Baratta, a principal at Blackstone. 'Southern Cross' commitment to providing high quality care to communities in which it operates is absolutely key to us.'

'Our ambition is to build, in partnership with management, the UK's leading healthcare services provider operating in the private and public-pay elderly care and specialist care markets,' Baratta said. 'Southern Cross is the ideal platform from which to execute this strategy.'

The healthcare services sector has attracted increasing interest from private equity players in recent months. The combination of strong demand for healthcare services as the population ages and the highly fragmented state of the sector is judged to provide strong consolidation opportunities.

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