Care on Credit: Colisée's Future and Europe's Elder Care Crisis

STOCKHOLM, SWEDEN – December 08, 2025

The announcement was couched in the sterile language of corporate finance: a “financial recapitalization plan” and a “transition of ownership.” But for Colisée, a European giant in elderly care with nearly 400 facilities, the news signifies a seismic shift. Private equity owner EQT Infrastructure V is out, forced to exit its investment after a plan led by the company’s own lenders was imposed. It’s a stark conclusion to an ambitious project that began in 2020, aimed at combining profit with high-quality care.

While the press release paints a picture of a responsible transition, the reality is far more complex. This event is more than just a private equity deal gone sour; it is a powerful case study exposing the immense pressures squeezing Europe's elderly care sector and a cautionary tale about the collision between financial engineering and a deeply human social mission. As Colisée CEO Arnaud Marion thanks EQT for its commitment and expresses confidence in the future, the deeper question looms: what happens when the people holding the debt, not the mission-driven investors, are the ones calling the shots?

The Cracks in the Foundation

When EQT acquired a majority stake in Colisée in 2020, the playbook seemed clear. The firm would pour in capital to expand the portfolio—which it did, from 270 to almost 400 facilities—and invest in quality, training, and sustainability. Colisée even became the first nursing home operator in France to adopt the status of entreprise à mission, a legal framework committing a company to social and environmental goals. On the surface, it was a model of modern, responsible investment.

Beneath the revenue growth, however, the financial foundation was crumbling. Since 2022, Colisée has been battered by what the official statement diplomatically calls “market-related headwinds and operational challenges.” The reality was a perfect storm. Soaring inflation drove up the cost of everything from food to energy. A continent-wide shortage of caregivers sent labor costs spiraling. And rising interest rates made the company's debt burden increasingly heavy.

The numbers tell a story of severe distress. According to S&P Global Ratings, Colisée's adjusted debt was projected to climb well above ten times its earnings, a dangerously high level of leverage. The company's core profitability metric, its EBITDAR margin, plummeted from 24.8% to 20.5% in the first nine months of 2024 alone. Credit rating agencies took notice, with Moody’s downgrading the company to Caa2, a rating that signifies “high credit risk.”

The final act saw a power struggle between owner and creditors. EQT put forward its own proposal to stabilize the company, which reportedly included a significant injection of new equity. But the lenders, seeing their position compromised, rejected the offer. They chose instead to impose their own plan: a debt-for-equity swap that hands them control of the company while forcing EQT and other shareholders to walk away from their investment. It’s a brutal reminder that in a distressed situation, the debt holders ultimately wield the most power.

A Sector Under Siege

Colisée’s predicament is not an isolated incident. It is a symptom of a systemic crisis facing the entire European elderly care market. The demographic trends are undeniable: Europe has a rapidly aging population, and the number of individuals needing long-term care is set to surge by over 20% by 2070. This should, in theory, create a booming market for providers like Colisée.

However, the economic model to support this demand is broken. Public investment has failed to keep pace, creating a vast “care gap” that the private sector has been encouraged to fill. Yet private operators are now finding themselves trapped. Transaction volumes for nursing homes fell by a staggering 35% in 2023 as rising interest rates and operational costs scared away investors. The very capital needed to build new facilities and modernize old ones is drying up.

The most urgent challenge is the human one. The industry is bleeding staff. Across the European Union, an estimated one in four healthcare jobs went unfilled in 2023. Low wages, poor working conditions, and intense burnout are driving caregivers away from the profession at a time when they are needed most. This shortage not only impacts the quality of care but also puts immense financial pressure on operators forced to pay more to attract and retain a shrinking pool of qualified workers.

This confluence of factors—unstoppable demographic demand, insufficient public funding, rising operational costs, and a crippling labor shortage—has created a landscape where even a well-capitalized, expansion-focused operator backed by a global investment giant could not find a sustainable path to profitability.

The Human Cost of Financial Restructuring

With Colisée now in the hands of its creditors, the central tension between financial viability and social responsibility comes into sharp focus. The new ownership’s primary objective will inevitably be to stabilize the company's finances and recover its investment. The critical question is what that will mean for the residents and the employees at the heart of Colisée’s mission.

Academic research on the impact of private equity in healthcare provides a sobering backdrop. Multiple studies have suggested that such ownership can correlate with reduced staffing levels, an increased focus on cost-cutting over patient care, and, in some cases, poorer health outcomes for residents. The relentless pressure to generate high returns can lead to cuts in services, supplies, and staffing hours—the very elements that define quality of care.

To its credit, Colisée under EQT’s tenure appeared to be pushing against this narrative. Its status as an entreprise à mission, coupled with investments in staff training and rigorous quality monitoring frameworks, suggested a genuine attempt to balance profit with purpose. The company even implemented an anonymous feedback system for employees to voice concerns, a sign of a progressive internal culture.

But can these laudable initiatives survive a restructuring led by lenders? When a company's debt-to-EBITDA ratio is in the double digits, difficult choices must be made. The new owners will face immense pressure to streamline operations and cut costs. Whether they can do so without compromising the quality of care and exacerbating staff burnout remains the most significant unanswered question. The future of Colisée will serve as a crucial test case for whether the promise of high-quality, mission-driven care can endure when the balance sheet is under extreme duress.