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Southern Cross demise brings new opportunities

Care home operator Southern Cross this week announced that it is set to shut down after landlords owning all 752 of its care homes said they wanted to leave the group.

The Darlington-based business, which reported half-year losses of £311m, has been hit by a combination of falling admissions, pressure on fees paid by cash-strapped authorities and rising rents for its properties. 

Trading in Southern Cross’s shares has been suspended.

But as one company falls, another looks sets to profit.

Phil Burgan has been running Maria Mallaband Care Group (named after his grandmother) since 1996 and has turned it into one of the country’s biggest providers of care for the elderly and mentally ill. His Leeds-based firm has 76 care homes, sales of £50m a year and employs 1,700 staff. 

When we spoke to Burgan last month, he told us that his business could potentially “double in size” with the demise of Southern Cross and he was quietly preparing to buy up a chunk of its homes.

Burgan, a former pharmacist, turns 61 next year but has no plans to slow down: “I can’t imagine anything worse than retiring.

Phil Burgan is one of the ten “silverpreneurs” featured in the summer issue of Real Business magazine. Sign up for your copy here.


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