The Malhotra Group has announced plans to invest £100m in the care and leisure sectors over the next five years after securing a multi-million pound bank deal to support ambitious growth plans.
The Newcastle firm – which owns and runs divisions specialising in care, leisure and commercial property investment and development – has secured a £25m deal using the Funding for Lending Scheme structured by The Royal Bank of Scotland (RBS), a facility it is now using to develop areas of the business and fund a major restructuring operation of the group itself.
The group, which has a consolidated turnover of around £40 million and is involved in more than 100 properties and numerous business including Prestwick Care, has now consolidated all the Malhotra holdings into one formal group, which in due course will obtain PLC status.
Newcastle law firm Sintons, which has worked with the Malhotra Group and its divisions for several years, have overseen the restructure, which has been two years in the making. Gordons acted as legal advisors to RBS and the detailed tax and restructuring advice was provided by Ernst & Young.
The creation of Malhotra Group PLC, which employs 1,000 staff, comes at a time of significant progress for the business having devised a five-year programme intended to invest £57m in care and a further £43m in leisure, as a demonstration of the group’s commitment to the region.
Meanwhile, RBS have organised the £25m funding using the bank’s Government-backed Funding for Lending Scheme (FLS), a facility which includes development funding to support the construction of a new purpose built 54-bed care home at Melton Park, Newcastle.
The care home, creating around 70 new jobs, forms part of the group’s plans to provide 2080 specialist care places across the North East by 2018.
Further developments are also due within the leisure division, which already operates Osborne’s, Scalini’s and The Three Mile Inn.
Meenu Malhotra said: “This is a very exciting time for the Malhotra family and all our divisions. Our achievement and growth would not have been possible without the hard work and loyalty of our dedicated staff. We are also very appreciative of the support from RBS, Sintons and Ernst & Young.
“We are proud to be forging strong links with RBS who in spite of the all the negative publicity are lending to local businesses like ours.”
Alok Loomba and Christopher Welch, partners in the real estate and corporate departments respectively at Sintons, oversaw the restructure.
Loomba said: “We are very pleased to be able to assist in the latest stage of their progress which we hope can support Malhotra Group PLC in achieving their growth aspirations regionally and nationally.”
Martin Greenwood, director of corporate banking at RBS, added: “We are delighted to be supporting the family as they enter a new period of growth and help Meenu and Bunty secure solid foundations for the next generation of the business.”