HgCapital sells Castlebeck

HgCapital has sold Castlebeck, a UK provider of specialist healthcare and rehabilitation services for adults and adolescents with learning disabilities and challenging behaviour, to Castle Holdings Limited for £255m.

The sale comes four years after HgCapital acquired the business from 3i, which saw it invest £20m of equity for an 85% stake. Since July 2002, the mid-market firm put together a new management team, lead by chief executive David Cole, and oversaw a £30m investment programme into new hospital facilities across the UK, the addition of almost 100 beds, the development of a pioneering service for adults with autism and challenging behaviour, the creation of three homes for young people opened under the Young Foundations brand, and the investment into a team of 15 psychiatrists and psychologists.

In April 2005, HgCapital completed a £73m recapitalisation of Castlebeck, which saw HgCapital return the majority of its original £20m equity investment to its investors, while retaining its 85% interest.

New owners Castle Holdings Limited is a Jersey-registered company associated with Barchester Healthcare group, a UK private healthcare provider.