Allied Secures Credit Extension as it Seeks to Transfer Home Care Contracts

Troubled home care group Allied Healthcare has been attempting to sell or transfer many of its contracts to other providers since the Care Quality Commission warned local authorities about its impending insolvency on November 5.

The Stage 6 notification, the first issued by the CQC under its Market Oversight programme, informed councils that the domiciliary care provider could guarantee solvency only until November 30. At the time, Allied complained that the notice was premature.

Since then, the firm – which is owned by the German private equity business Aurelius – has said that it has secured credit for a further three weeks’ of operation beyond that date from Royal Bank of Scotland.

Nevertheless, the damage caused by the CQC notice has been ongoing, with staff recruitment and retention disrupted, a spokesperson warned.

The spokesperson also argued that the CQC’s action had “intensified the impact of the challenging environment within which we operate and comes immediately prior to the Christmas period, when pressures on care providers are at their highest.”

Allied provides home care services for around 13,000 people across 84 local authorities – many of which had begun to consider contingency plans after the company announced debt restructuring by way of a Creditors’ Voluntary Agreement in the spring.

Ian Hudspeth of the Local Government Association stated: “Councils are confident of ensuring care for people affected and are also focused on retaining the highly valued staff that deliver these services to help keep the transition in business ownership as smooth as possible.”

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