ao link

Swan takes £50m loan from potential parent Sanctuary

News18 Nov 2022James Wilmore

Troubled housing association Swan has secured a £50m loan from its potential merger partner Sanctuary as the organisations remain in talks.

Linked InXFacebookeCard
Sharelines
Troubled housing association Swan has secured a £50m loan from its potential merger partner Sanctuary as the organisations remain in talks #UKHousing #SocialHousingFinance

At the same time, the Essex-based group has repaid a £40m loan to Orbit, with which it was in merger talks previously. 

 

Swan said today the new secured loan with Sanctuary gives it “additional liquidity”. The terms of the loan were not disclosed. 

 

The 11,500-home landlord, which is currently non-compliant with the English regulator, is in a race against time to seal a merger with Sanctuary by the end of this month. 

 

Swan revealed last month it was facing a possible annual impairment of £178.4m and has £24.3m in cash, which it said would only fund its subsidiaries until “early December”. 

Read more

Sanctuary likely to scale back development if Swan merger goes ahead, says S&PSanctuary likely to scale back development if Swan merger goes ahead, says S&P
Swan downgraded to BB- and faces possible £178m impairmentSwan downgraded to BB- and faces possible £178m impairment
Swan eyes Sanctuary as Orbit merger collapsesSwan eyes Sanctuary as Orbit merger collapses

S&P, the credit rating agency, downgraded Swan the same day. It said its financial position had “deteriorated rapidly” and the landlord required external support to “remain a viable business”. 

 

In an update to the markets today, Swan said it was still “in discussions” with Sanctuary about a “possible business combination”. Swan will become a subsidiary of 105,000-home Sanctuary if the deal goes ahead. 

The filing added: “Any future agreement regarding a possible business combination will be subject to the ongoing due diligence and the approval of the boards of both organisations.” 

Housing Association/RPMergers and Acquisitions
Linked InXFacebookeCard
Add New Comment
You must be logged in to comment.

RELATED