Anchorage Capital and Credit Suisse International’s joint 11th hour counter proposal to suspend the imminent sale of the NHP Group’s 282-strong former Southern Cross nursing homes has been rejected by class A noteholders.
U.S. Bank Trustees, the trustee and cash manager of the Titan Europe 2007-1 (NHP) Limited CMBS transaction, confirmed this morning that the alternate proposal for the sale of the collateral secured by the Libra Loan has been rejected by a representative of a group of noteholders who purport to hold in aggregate more than 60% of the outstanding class A notes.
In a statement published this morning, U.S. Bank Trustees said it had received a written statement from the class A group that “the class A Group is not interested in pursuing the [alternative Anchorage Capital and Credit Suisse] proposal”.
The statement continued that the class A group – which includes dominant noteholder Och-Ziff – is “supportive” of special servicer Capita Asset Services’ current sale plan for the property company and operating business which noteholders expect will “generate sufficient proceeds to repay the class A Notes at par”.
The remaining complexity which needs to be determined is whether the unpaid swap payments – calculated at £75.6m by Capita and £90.6m by Credit Suisse – rank above or below the class As.
Capita has sought the opinion of the cash manager in this regard, U.S. Bank Trustees, which is yet to respond to this request.
If U.S. Bank Trustees determines that the unpaid swap payments rank junior to the class As, Credit Suisse may choose to exercise its right to seek a legal ruling, which may result in the CMBS transaction returning to the High Court.
CoStar News understands that there are five bidders which have progressed to the second stage of the sales process of NHP Group business, HC One Limited. These include Duke Street, Four Seasons, Formation Healthcare and Fondia Investment Management.
The preference – to maximise net proceeds to noteholders – is for a sale of the entire company, inclusive of the property company entities and trading operations, which carry most recent valuations of £443m and £529m, respectively.
Final, fully funded binding bids will be called later this summer and by early September at the latest.
The NHP 282-strong former Southern Cross nursing homes property portfolio was valued by JLL at the end of 2013 with three differing levels of security. The direct nursing homes assets were valued at £426.7m, the property-owning companies were valued at £443.1m, while the property owning companies and trading operations were valued at £529m.
CoStar Finance 