Cavendish founder leaves in management shake-up: Main board to concentrate on search for acquisitions after 'amicable' parting

THE founder and managing director of the Court Cavendish nursing home operator, Kevin Finch, has left after a management shake-up.

He had increasingly taken a back-seat role. However, Chai Patel, his friend and chairman of the company, insisted the parting was amicable, and by mutual agreement.

The company was one of the new issue flops of last year, though the shares have recovered after sinking well below their 225p flotation price. They closed yesterday at 242p, down 0.5p.

There was initial concern about the quality of management, though worries were quickly soothed.

Following Mr Finch's departure, Mr Patel has created an operating board as part of a move to regionalise operations and improve communications from the shop floor.

Analysts said the main board would concentrate on strategy and the search for acquisitions.

Clive Johnstone, previously commercial manager of Takare, a rival nursing homes group, is to join the new operating board as business development director. Mr Finch is credited with giving Cavendish its early entrepreneurial flair, though he is said to have become dissatisfied with the job as the group expanded.

One analyst said: 'This sort of business is pretty simple to run and you can rely on middle management once they are up and running. There is simply no need to be top-heavy in executive directors. Chai Patel is the driving force and that is all you need.'

Mr Patel, a doctor-turned- merchant banker, met Mr Finch at Shearson, the stockbroker, in London, where he worked in the property investment department. There, in the late 1980s, they planned their launch of a nursing homes business.

The company said Mr Finch was out of contact, and might have gone on holiday.

He is planning to develop other business interests, said to include activities abroad, but would definitely not set up a rival nursing home company.

Latest figures show that Cavendish, the fifth-largest nursing home operator in the UK, saw pre-tax profits rise from pounds 86,000 to pounds 450,000 in the six months to 31 October, despite a pounds 600,000 exceptional charge for an interest hedge. The full-year forecast is for about pounds 3.1m.

Most of the pounds 13.9m raised at the flotation has been spent on acquisitions and the City is not ruling out further fund-raising.

The new operating board consists of Steve Goodwin, regional operations director and head of care services; Eamon O'Keeffe, regional operations director and head of hotelling services; Sushil Radia, operations director - finance and administration; Duncan Swirles, property and development director; and Clive Johnstone, business development director. Tony Hayward remains finance director.