Swan becomes subsidiary of Sanctuary as rescue merger completes
Sanctuary Group’s rescue merger of troubled Swan Housing Association has completed, creating a 116,000-home social landlord.
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Swan joined Sanctuary Group as a subsidiary on Wednesday (8 February) following the formal completion of the business combination proposal, which was approved by the boards of both organisations.
Sanctuary previously managed more than 105,000 homes, including social housing, care homes, supported housing and student accommodation, while Swan brought over 11,500 homes across east London and Essex. Combined, the group oversees 116,000 homes across England and Scotland.
Swan will continue as a standalone operation while future integration plans are discussed.
Susan Hickey will step down as chief executive of Swan and Dave Soothill, previously Sanctuary’s development director in England, will assume responsibility for Swan as its managing director.
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Discussions between the two housing associations regarding the merger were first announced in September last year when Swan’s planned merger with 46,500-home Orbit Group collapsed.
The boards of the two housing associations gave the green light for the merger in November but then it was delayed and did not complete by the earmarked date of 30 November, as it remained subject to “third-party consents”.
Craig Moule, group chief executive of Sanctuary, said: “As one of the largest providers of social housing in the country, Sanctuary is financially strong, well-run and has the experienced team in place to help Swan manage its challenges.
“We are committed to securing the strength of the sector, ensuring affordable housing continues to be accessible in communities across the country.
“Susan has worked diligently to secure Swan’s future. I’d like to extend my thanks to Susan for her hard work and commitment to Swan’s residents and employees.”
Swan has been non-compliant with the Regulator of Social Housing since December, when it was handed a G3/V3 rating.
In October, Swan was facing a potential annual impairment of £178.4m and credit ratings agency Standard & Poor’s downgraded Swan to a BB- rating, which means it faced “major ongoing uncertainties”.
As merger talks were ongoing, in November Swan obtained a £50m loan from Sanctuary to provide it with “additional liquidity” and enable it to repay a £40m loan from Orbit.
Sanctuary Group has previous experience with mergers, having integrated troubled housing association Cosmopolitan in 2015.
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