FalkenSteg consults on sale of Wohnpark Rethen nursing home to Convivo

On 1 May 2019, Bremen-based health company Convivo Unternehmensgruppe completed its takeover of Diakonische Pflegeeinrichtung Wohnpark Rethen gGmbH – the operator of Wohnpark Rethen, a residential nursing home in Laatzen, near Hanover. The firm had previously entered debtor-in-possession management under company director Joachim von der Osten, consultant Dr Christian Matiebel and administrator Tobias Hartwig from Braunschweig-based law firm Schultze & Braun. Working together with FalkenSteg, the insolvent company was able to keep trading at full capacity and was transferred in its entirety to a special-purpose acquisition company owned by Convivo via a business asset sale. As a result of the transaction, it was possible to save the jobs of the home’s sixty employees and the places of all its long-term care residents, who numbered seventy-two at the time.

Wohnpark Rethen is part of a group of companies run by Diakonische Altenhilfe Region Hannover gGmbH and a member of the Diakonisches Werk, a Protestant church-affiliated charity organisation. The facility in Rethen, about nine miles south of Hanover, can house up to eighty-seven care residents. Sixty employees are responsible for its residents’ welfare and provide residential care services. The non-profit organisation had suffered in recent years, experiencing frequent changes in various management positions and continually posting losses. Fierce competition in the Hanover area made it increasingly difficult to attract and retain the qualified staff required to reach the legal quota for skilled personnel. The home aimed to maintain its quality of care via a self-imposed freeze on new resident admissions. The resulting underuse of its capacity ultimately led to the company filing for insolvency under debtor-in-possession management in August 2018.

On 1 May 2019, Bremen-based care group Convivo took over the insolvent company’s business operations in full. The Convivo Group is a provider of residential, domiciliary and hybrid old-age care services across Germany. The company was founded in 1993 and has since been led by its founder and managing director Torsten Gehle, who himself is a trained geriatric nurse. Convivo has established itself as one of Germany’s top twenty largest care companies thanks to its reputation as a high-quality strategist experienced in restructuring situations. The group manages more than 90 nursing homes, 3,000 residents, 700 senior living apartments and serves over 1,200 home care recipients. Convivo operates other care facilities locally and can capitalise on workforce and cost synergy thanks to its market position.

The FalkenSteg Healthcare team, headed by partner Jochen Wierz, received an exclusive mandate to be the sell-side financial advisor helping implement the investor recruitment process. Having worked on the sale of Wohnpark Rethen and successfully completed other transactions in the sector in the first half of 2019, FalkenSteg reaffirmed its market-leading position in M&A for crisis-stricken care service providers.

Tobias Hartwig
Schultze & Braun

Debtor-in-possession management consultants
Dr. Christian Matiebel
Rechtsanwalt Olaf Schubert

M&A Advisory
Jochen Wierz (Partner)
Enis Lütkenhöner (Associate)
Martin Bjelanovic (Analyst)