Priory clinics sold for £925m

Part-nationalised Royal Bank of Scotland, which acquired the Priory Group in 2007 when it bought Dutch bank ABN Amro, has agreed to sell the specialist mental and healthcare firm to buyout specialist Advent International.

The disposal of the Priory Group, which has 66 sites across the UK, marks the end of a lengthy sale process for RBS.

It had hoped to float the Priory on the stock market last year, but is said to have shelved the plans due to market volatility, then exclusive talks with Bain Capital reportedly collapsed early last month.

The sale is thought to have been hampered by concerns over the impact of Government spending cuts on the Priory Group, with more than 75 per cent of funding coming from the public sector.

The Priory has also been left with hefty debts after a series of takeovers in recent years and yesterday's deal includes payment of borrowings.

RBS – 83 per cent owned by the Government – said that, after payment of debts, it expects to receive equity proceeds of up to 133m.

Advent is expected to complete the takeover by the end of March.

The Priory Group was founded in 1980 with the purchase of the Priory Hospital, Roehampton, by a US healthcare company.

It now operates hospitals, schools and care homes throughout the UK, providing treatment including for addictions, acute psychiatry, secure mental healthcare, specialist complex care and rehabilitation.