Retirement housebuilder McCarthy & Stone is poised to take a step towards ensuring its survival, according to sources close to the situation

The company is planning to strike a similar debt-for-equity deal to the one Crest Nicholson reached last week.

According to sources, it is close to agreeing a “lock-up deal” with its lenders. This prevents the debt from being traded, and is a necessary step before a court sanctions the swap by means of a “scheme of arrangement”.

The lock-up deal was expected to be agreed this week after negotiations between the company and its estimated 60 lenders. The source said: “Talks have gone well and there is good support for this process.”

Crest’s lenders agreed to write off £630m of debt in exchange for 90% of the housebuilder.