Sector: Residential Care
Support: Diversification Strategy
Having been referred to us by an existing client, the Directors of a leading nursing and care home group engaged our practice to help them reach new heights.
After the turbulence of the COVID-19 pandemic, the Directors of a leading Nursing and Care home group were keen to explore how they could reduce the reliance on the core areas of their business and invest in wider industry opportunities. They knew this would require an element of business restructuring and thus, support from a professional services firm with business restructuring would be needed.
When an existing client made an introduction, we were quick to arrange a discovery meeting with the Directors to learn more about their business and intentions. During the discovery meeting, we took time to understand the key challenges they faced in their current business, what the end goal was and any particular areas of diversification they had explored.
Following a comprehensive fee proposal, the client was onboarded and the journey began. First, we needed to ensure the client fully understood the process of restructuring and the benefits and drawbacks of the restructure and the potential challenges they could face, particularly with regards to statutory clearance from HMRC.
With years of experience, we knew the best solution would be to devise a group structure which included a parent holding company, and then submit an application to HMRC for Statutory Clearance. Taking this approach would remove the requirement to settle Capital Gains Tax and Stamp Duty on the transfer of shares from their individual ownership to the holding company – which is known as a share-for-share exchange.
Given the dialogue between ourselves and HMRC was transparent and regular, we were able to successfully communicate the true commercial reasons for the transaction and obtained Statutory Clearance.
What this meant was the diversification strategy could be achieved whilst ensuring that the exist business could continue uninterrupted and without risk of hinderance if the diversification strategy was not successful.