Qualia Care Holdings - Case Update

Yet another member of the Qualia Group - a group of companies whose business model was to use investor funds to acquire care homes in the north of England - has entered administration.

Stephen Hunt of Griffins was appointed as administrator of Qualia Care Holdings on 22 December 2023. He had previously been appointed on a number of connected companies, Qualia Care Developments, Qualia Care Properties, Property Alternative Holdings and Qualia Care, in 2022.

The Qualia Group’s business was formed from a pre-pack sale in 2020 after Qualia Care Developments and Qualia Care Properties failed, leaving over 700 investors owed in excess of £50m. The agreement for payments to be made to investors fell into default in December 2021. There was an attempt to rescue Qualia Care outside of administration, but it was discovered that large sums had been removed from its bank accounts just prior to the administration. The FCA brought a successful action against the former director for running an unauthorised collective investment scheme.

In the case of carrying out his duties in respect of the other companies, the administrator discovered that various intercompany payments were made to Qualia Care Holdings which, in his opinion, were not to the benefit of the other companies. He demanded repayment, which was not made. The company’s director ceased communication with the administration in September 2022.

Given the complex nature of the group, the administrator was of the view that it would be in the creditors’ best interests for the company to be under the control of the same insolvency practitioner. As a result, he made an application to place the company into administration. He currently anticipates a dividend of 20% for non-preferential creditors.

The administrator has been assisted by Gateley Legal. His proposals can be found HERE.