Case Summaries · France

Colisée's lenders swapped €680m of debt for the company. EQT lost its shirt.

Seven turns of leverage on regulated care tariffs, restated accounts and a safeguard plan that handed the group to its lenders.

By EURx · 14 October 2026

How we got here: a debt-funded care home roll-up meets regulated tariffs

Groupe Colisée operates care homes and home-care services in France, Belgium, Italy and Spain. It grew for two decades by acquisition, buying homes and smaller operators with borrowed money, and in 2021 EQT acquired it in a deal reported at more than €2bn. The purchase was financed in part with an €875m term loan B due 2027, priced in October 2020 at a margin of EURIBOR+400. In June 2021, Colisée raised a €150m add-on and repriced the whole term loan to EURIBOR+375 at an issue price of 99.75, using the new money to repay RCF drawings, and a month later a further €140m fungible add-on at 99.5 (same margin) to fund the acquisition of the French operator SGMR Les Opalines, taking the term loan to €1.17bn. The loan was cov-lite with a springing net leverage covenant set at 9.85x and tested only when the revolver was 40% drawn. The senior facilities put in place at the EQT and CDPQ buyout ran to €1.38bn, about 7x the roughly €200m of EBITDA the group was generating at the time. That €1.38bn is the term loan and the revolver together: the €875m term loan grew to €1.17bn through the two 2021 add-ons, and the €217.6m revolver brings the senior facilities to €1.38bn.

Care home revenue is set in annual tariff negotiations with the regional health agencies and the départements, so it rises by negotiation rather than by price. Costs, meanwhile, are real wages, food and energy, and they went up with inflation. What that leaves is a thin, steady margin that can service a moderate amount of debt and no more. Colisée's debt service was not moderate.

The deterioration shows in the group's own numbers. Revenue kept rising through the roll-up years, from €1.26bn in the 15-month reporting year to end-2021 to €1.65bn in 2024, but operating income went the other way, from €128.2m over that same period to €59.1m in 2023 and an operating loss of €29m in 2024. The court's judgment traces the gap to costs: payrolls rose 6.9% in a single year, beyond the group's own targets; site directors in France, who enjoyed wide autonomy, hired freely, and purchasing costs rose 10.8% in an inflationary market, so total costs grew faster than revenue. Care homes bought at high valuations in the roll-up, with rents that quickly became unsustainable, left the group with free cash flow of about minus €100m a year.

Then came the restatements. The management installed in October 2024 found anomalies running back years, and the group restated its 2023 accounts, cutting EBITDA before IFRS 16 from the published €181m to €131.6m, the result of accounting irregularities under the former management: unjustified entries organised at the centre of the group had inflated EBITDA by €30m to €50m a year going back to 2021. Impairment tests home by home wiped €1.75bn off the balance sheet, including €1.30bn of goodwill, and the group booked a consolidated net loss of €2.01bn for the year, leaving equity at minus €419m. Management's own business plans had valued the group at €4.4bn at the end of 2022 and €3.9bn a year later; the plan rebuilt in the spring of 2025 on the real cash generation put its value at about €1.475bn at the end of 2024.

By mid-2024 Colisée carried net leverage of 9.6x before IFRS 16, against 8.0x at DomusVi, its closest French peer, and by September 2024 it was above 12x. An independent business review by Eight Advisory, commissioned ahead of the creditor talks, put 2024 EBITDA at about €105m, with cash of €32m at year-end. By the end of 2025 net leverage stood at 12.3x, and the company began facing a real risk of missing future interest payments. S&P cut Colisée to CCC- from B- on 19 March 2025 when the group asked its lenders to defer the term loan interest payment due 11 April 2025, calling the transaction a likely distressed exchange and setting a negative outlook.

The creditors group up

Through 2025 the senior lenders organised. The reported ad hoc group at the centre of talks comprised CVC, KKR, Blackstone, Polus and Barings, and other eventual large funds involved included HIG Capital, Farallon, Acasta, Alinor, Caius and Fortress. The TLB group had retained PJT Partners as its financial adviser and White & Case as counsel, while the RCF banks worked with Perella Weinberg; the company itself had hired Rothschild and Gibson Dunn. They granted standstills over the missed payments and arranged a €50m bridge facility through JP Morgan in September 2025 that was never drawn. A senior lock-up was signed on 25 November 2025 with holders of 96.29% of the term loan B and 91.13% of the RCF, and a parallel lock-up with the French bilateral banks followed on 1 December. By then the senior group spoke for nearly all of the creditors (bilateral banks, which lend directly to the operating companies, were negotiating in parallel). The creditor coordination ran alongside the company's own path through the amiable stages of French restructuring law, which had begun months earlier.

Conciliation, mandataire ad hoc and the safeguard

The restructuring ran through three amiable stages alongside that creditor coordination. A conciliator was appointed on 11 March 2025, converted to a mandataire ad hoc on 7 August 2025 as the talks dragged, and appointed conciliator again on 17 November 2025.

To execute the deal, Colisée requested an accelerated safeguard on 8 December 2025, combined with a conciliation to restructure the bilateral debt. The tribunal des affaires économiques de Paris opened the procedure by judgment on 22 December 2025 for an initial two months, extended it on 16 February 2026 to 22 April, and adopted the plan by judgment of 20 April 2026. The restructuring became effective on 30 April 2026.

Resolution: the plan and the reinstatement

The agreement in principle signed in December 2025 set the shape of the deal: €283.6m of new financing (up from the €260m first discussed as the talks progressed), a €215m super senior note and a €68.6m super senior RCF. €829m of senior notes (the old euro term loan) and RCF reinstated and extended to August and November 2031; net debt cut by ~€600m to ~€1.2bn; and ~€680m of senior claims converted into equity, which made the converting lenders the group's new shareholders. On the plan's projections the leverage path runs from 8.3x at the end of 2026 to about 7x by 2030. The group's bilateral banks renewed their facilities, a vote of confidence in the quality of the care homes rather than the holdco structure above them.

EQT had put forward its own proposal built on significant new equity, but the lenders imposed their own plan, and EQT exited with its investment written off. A new supervisory board was put in place, and Arnaud Marion remains president of the group.

Every class of affected creditors carried the plan with 100% of the votes cast, an unusual level of consent for a deal that handed the company to its lenders. The court-appointed expert's valuation explains part of it: going-concern enterprise value of €913m to €1,214m against €571m to €613m in liquidation, which put the TLB and RCF's liquidation recovery at 26.6% to 29.5%. The plan paid more than a liquidation and gave the lenders the company.

S&P cut Colisée to SD on 11 May 2026 when the exchange completed, calling the recapitalisation distressed and tantamount to default, then upgraded the group to CCC+ with a stable outlook the next day on the new structure. On S&P's read, the post-restructuring stack runs a €215m super senior note and an undrawn €69m super senior facility in front of the reinstated €749m term loan and an undrawn €80m RCF, with most of the debt maturing after the turnaround plan ends in 2030, and adjusted leverage above 9x through 2027.

Moody's came three weeks later, upgrading the corporate family rating to Caa2 from Ca with a stable outlook, while flagging that adjusted leverage stays around 8.5x to 9.0x with free cash flow still negative over the next 12 to 18 months. The debt now carries a €75m minimum liquidity covenant, tested quarterly from September 2026, and the super senior RCF has a springing net leverage test with a ceiling that starts at 14.1x at the end of 2026 and steps down to 10.9x.

What we are watching next

• Governance: what the new owner group does with the supervisory board and the pace of any operational changes.
• Tariffs: the 2027 negotiations with the ARS and the départements, which set the revenue line the whole structure depends on.
• The covenants: the first quarterly €75m liquidity test in September 2026 and the leverage headroom under the super senior RCF.
• The bilateral facilities: when the renewals fall due again.
• And the sector: Orpea went through this in 2022, Medicharme was restructured under its own debt load, and Colisée is the third data point in a pattern.