One of Britain’s largest care home groups, Four Seasons Health Care, is on the brink of administration.
Two of the holding companies behind the firm are expected to appoint administrators on Tuesday after struggling to repay their debts.
The group serves about 17,000 residents and patients and employs some 20,000 staff.
If it goes under, it would not affect care arrangements or lead to the closure of homes.
According to Sky News, which first reported the news, it would be the biggest collapse of a care homes business since Southern Cross in 2011.
Four Seasons Health Care said it would issue a statement later on Tuesday.
The GMB union said the government needed to step in urgently to reassure Four Seasons staff and residents.
Rehana Azam, GMB national secretary, said: “The possible collapse of Four Seasons shows our care system is in crisis, it is crumbling beneath us because the funding isn’t there.”
Professional services firm Alvarez & Marsal (A&M) has been chosen to handle the administration.
It is understood that while the holding companies – Elli Finance (UK) and Elli Investments – are on the brink of collapse, the care homes business itself is not.
Administrators will seek to sell the group in the coming months, freeing it of its historic debts.
Four Seasons, which has 253 residential and nursing care homes, has been struggling to restructure its debt pile of more than £500m.
Terra Firma Capital Partners, the private equity firm led by Guy Hands, has owned Four Seasons since 2012.
But it is no longer in control of the business, as a large amount of its debt is being held by US hedge fund H/2 Capital Partners.
A number of care businesses have run into trouble recently, raising questions about the current funding model for social care.
Last year, Allied Healthcare, which supports 13,000 people, said it was struggling with debts, blaming low fees paid by councils.
The Care Quality Commission, a regulator, later issued a notice saying it had serious doubts about the firm’s future.
A majority of Four Seasons’ operations are funded by the state, with about a fifth of them funded privately.