Health Care REIT, Inc. : Health Care REIT Comments on Genesis HealthCare's Acquisition of Sun Healthcare Group
06/20/2012| 05:05pm US/Eastern
Health Care REIT, Inc. (NYSE:HCN) announced today that its
largest tenant, Genesis HealthCare, has entered into an agreement to
purchase Sun Healthcare Group (NASDAQ GS: SUNH) in a $300 million
transaction. The combination of Genesis HealthCare and Sun Healthcare
Group will create the largest provider of post-acute and skilled nursing
services in the country with over 420 facilities located in 29 states.
On a combined basis, the two companies generated approximately $4.0
billion in revenue in 2011.
"The transaction provides George Hager and his team the opportunity to
expand the Genesis portfolio and to increase the scale of its
rehabilitation therapy, hospice and inpatient services," commented
George L. Chapman, Chairman and Chief Executive Officer of Health Care
REIT, Inc. "We expect the transaction to have a positive impact on the
financial strength of Genesis, further enhancing our investment."
Genesis' corporate fixed charge coverage is expected to remain unchanged
as a result of the transaction, with the opportunity for improvement
when operational efficiencies are achieved. The eighteen facilities
currently leased by Health Care REIT to Sun will be added to the master
lease with Genesis, generating a nominal improvement in facility level
payment coverage of the Genesis lease.
The transaction has been approved by Genesis' and Sun's Boards of
Directors. The transaction is subject to customary closing conditions,
including Sun Healthcare Group stockholder approval, regulatory approval
and expiration of the waiting period under the Hart-Scott-Rodino (HSR)
Antitrust Improvements Act of 1976. The transaction is expected to close
in the second half of 2012.
About Health Care REIT, Inc.
Health Care REIT, Inc., an S&P 500 company with headquarters in Toledo,
Ohio, is a real estate investment trust that invests across the full
spectrum of seniors housing and health care real estate. The company
also provides an extensive array of property management and development
services. As of March 31, 2012, the company's broadly diversified
portfolio consisted of 956 properties in 46 states. More information is
available on the company's website at www.hcreit.com.
Forward-Looking Statements and Risk Factors
This document may contain forward-looking statements as defined in the
Private Securities Litigation Reform Act of 1995. When the company uses
words such as may, will, intend, should, believe, expect, anticipate,
project, estimate or similar expressions, it is making forward-looking
statements. Forward-looking statements are not guarantees of future
performance and involve risks and uncertainties. The company's expected
results may not be achieved, and actual results may differ materially
from expectations. This may be a result of various factors, including
Sun stockholder approval, regulatory approval and expiration of the HSR
waiting period; the parties performance of their obligations under the
transaction agreements; competition within the health care and seniors
housing industries; unanticipated difficulties and/or expenditures
relating to the transaction; and Genesis' ability to realize operating
efficiencies. Additional factors are discussed in the company's Annual
Report on Form 10-K and in its other reports filed from time to time
with the Securities and Exchange Commission. The company assumes no
obligation to update or revise any forward-looking statements or to
update the reasons why actual results could differ from those projected
in any forward-looking statements.
Health Care REIT, Inc.
Scott Estes, 419-247-2800
© Business Wire 2012