Two weeks ago, Seniorcare Nominees, which owns Rendell on Reed, told the Southern District Health Board (SDHB) it wanted to terminate its contract.
However, a shortage of aged care in Oamaru meant the rest-home’s 50 residents were facing the possibility of having to leave town.
A health board spokeswoman said the Observatory Village Trust, set up by council-owned Waitaki District Health Services, would take over management of Rendell on Reed from December 15.
A meeting was held yesterday to discuss the handover.
Trust chairman Ken Scott said a company called Reed Street Healthcare Ltd would be created and managed by Rosie Dwyer from December 15 until some time in August next year when the Observatory Hill Retirement Village was expected to be open for business, Residents could then choose to go to Observatory or elsewhere.
Mr Scott said Mrs Dwyer was well-qualified.
"[She has] the expertise we feel is necessary.
"The whole objective is to have as little disturbance for residents. The care of the residents is paramount.
"If we had not been able to come into the sway now, it is probable residents would have been dispersed across the region."
Rendell on Reed director Vic Inglis, of Dunedin, said Seniorcare Nominees, of which he was also a director, had struggled to make the business viable, predominantly because of its inability to recruit and retain key staff.
The latest manager hired at the home, the seventh in the past two years, was leaving for Australia in two weeks, and another manager was moving out of the industry.
In an emailed response to questions on Thursday, SDHB planning and funding executive director Sandra Boardman said the board was involved in brokering the rest-home rescue.
"Because there are very few vacant aged residential beds in the Oamaru community, we knew this would result in residents being moved from their community.
"We were concerned this would not be the best outcome for residents or their family and friends and so endeavoured to find a solution where residents could remain in Oamaru long term."
