Learning disability services provider Care Management Group (CMG) has completed a refinancing deal which secures its future.
In the deal, CMG’s syndicate of banks has opted to exchange a portion of CMG’s debt for a 15% stake in the business – demonstrating their confidence that the business is well placed to continue to grow and thrive.
The new financial package marks the culmination of CMG’s 6-year transformation programme, which has been led by Court Cavendish, a turnaround specialist for the health and social care sector.
In 2007, prior to its takeover by Court Cavendish, CMG was a failing provider. The organisation was struggling to provide the minimum standards of care and was on the verge of financial collapse.
Court Cavendish, under the leadership of former Priory alumni Dr Chai Patel CBE, David Spruzen and Bob Lewis, took over the management of CMG, and they have overseen a fundamental overhaul of the company’s operational and financial performance. In the past 5 years, £12 million has been invested in services with significant additional investment planned in the coming period.
CMG’s approach now incorporates initiatives like a Service User Parliament, athletics championships held with Olympic and Paralympic athletes, and unannounced inspections of services by members of service users’ families.
The organisation also played a key role in the development of ‘The Driving Up Quality Code’, which outlines practices and behaviour for organisations that support people with learning disabilities, far exceeding minimum standards and promoting high quality care throughout the learning disability sector. The code has been endorsed by about 80% of providers in England.
New beginning Sir William Wells, chairman of CMG, said: “This financial deal marks a new beginning for CMG. We look forward to the safe and sustainable future that has been secured for all our staff and service users.
“Six years ago many people were unsure that CMG would be able to weather the financial and operational storm it faced. With the support and leadership provided by Court Cavendish we have not only survived, but emerged as a sector leader, both in the exceptional quality of the care we provide and our financial sustainability.”
Patel, who is now deputy chairman and major CMG shareholder, added: “The last 6 years have not been easy. When Court Cavendish took over the management of CMG in 2007 the business was in a dire financial and operational condition. Our first priority has always been a commitment to providing the high quality care our service users deserve.
“But high quality care cannot be maintained without sustainable financial backing. The deal is the culmination of a complete financial overhaul of CMG. The organisation now moves forward with what we call a ‘right-sized’ balance sheet and will be able to continue to lead by example and provide innovative social care services in a financially secure future.”
Patel also praised CMG’s banks for their backing of the company. “I also want to express my admiration for CMG’s management team led by managing director Peter Kinsey and financial controller Garry Fitton, and indeed every member of staff, who make a real difference every day to the lives of our service users and their families.”