TOLEDO, Ohio--(BUSINESS WIRE)--Health Care REIT, Inc. (NYSE:HCN) announced today that its second largest operating partner, Genesis HealthCare, has entered into a definitive agreement to combine with Skilled Healthcare Group, Inc. (NYSE:SKH). After completion of the transaction, the combined company will operate under the Genesis HealthCare name and will be traded on the NYSE. The combined company’s headquarters will remain in Kennett Square, PA, and George V. Hager, Jr. will be the CEO of the newly-combined company.
“George Hager is a highly experienced corporate and health care leader and we believe this transaction will create a compelling and efficient post-acute delivery platform that will improve patient outcomes,” commented Tom DeRosa, CEO of HCN. “We are privileged to have a strong partnership with George and the Genesis team. The increased scale, access to public capital and potential for improved credit metrics associated with this transaction benefits HCN and our shareholders.”
The combined company will operate more than 500 facilities across 34 states. As a result of the transaction, Genesis' corporate payment coverage is expected to improve, with further improvement expected over time as the company achieves operational efficiencies by capitalizing on its scale and platform.
As part of the acquisition of Genesis real estate in April 2011, HCN obtained an option to purchase a 9.9% interest in Genesis for a fixed price. HCN expects to pursue a cashless exercise of this option and expects to receive publicly traded stock reflecting a 3.2% interest in the newly formed public company.
The transaction has been approved by Genesis’ and SKH’s Boards of Directors. The transaction is subject to customary closing conditions, including SKH 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 early 2015.
About Health Care REIT, Inc. HCN, 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 June 30, 2014, the company’s broadly diversified portfolio consisted of 1,224 properties in 46 states, the United Kingdom and Canada. More information is available on the company’s website at www.hcreit.com.