What effect will mergers and acquisitions have on the quality of care in the UK care home industry - Essay Example

Some businesses that may command a significant amount of profit may become unprofitable in the long run and the vice versa can also hold true. In the UK, there has been a significant difference in the way in which the fortunes of care homes have changed in response to market demands and pressures. With the turn of the new millennium, business activities that involve mergers and acquisitions have increased a lot. Usually it is seen that mergers and acquisitions are reported between companies that have similar operational objectives or between companies that have very diverse interests.

Today a similar trend is being witnessed in the case of care home businesses also. Care home businesses are recently being acquired by real-estate companies or those which have a similar line of business operations. With the thinning out of the boundaries between assisted living and luxurious living, care homes have begun to cater to the need of the wealthy who need a facility that would give proper care, to lodge their elders. Today care homes are witnessing a change in focus that is different from what it used to be in the past.

While care homes catered exclusively to the sick and convalescing in the olden days, today, the same business caters to the need of wealthy clients who need to spend their time in a facility that provides medical as well as luxury needs. When comparing mergers a few years before and the mergers that are happening now, apparently there is a perceptible change in pattern. For e.g. in the olden days, mergers or acquisitions mostly happened when a company was declared sick. Such companies could not exist on their own.

Similarly, mergers were also executed to supplement the facilities of an existing company. Today, however, the management perceptions have changed and mergers happen between companies that are financially very sound, and are operating profitably. This phenomenon indicates that mergers can also happen to ensure