Kindred Completes First Closing For Its Skilled Nursing Facility Business Divestiture
LOUISVILLE, KY–Kindred Healthcare, Inc. (“Kindred” or the “Company”) (NYSE:KND) today announced that it has completed the first closing related to its previously announced agreement with BM Eagle Holdings, LLC, a joint venture led by affiliates of BlueMountain Capital Management, LLC (“BlueMountain”), to sell the Company’s skilled nursing facility business for $700 million in cash.
On August 31, 2017, the Company completed the closing for 54 skilled nursing facilities in 10 states. Sale proceeds from the closing were approximately $519 million.
Benjamin A. Breier, President and Chief Executive Officer of Kindred, commented, “We are pleased that we have completed the initial sale of a majority of the nursing facilities held for sale and look forward to completing the remainder of the closings by year end. We believe that the sale of our nursing facility operations will significantly enhance shareholder value, focus our attention to our higher margin and faster growing businesses, and advance our efforts to transform Kindred’s strategy.”
Mr. Breier continued, “On behalf of the Kindred Board of Directors and management team, I thank all of our caregivers for their hard work to facilitate a smooth transfer process. We appreciate and respect their dedication to our patients, residents and their families.”
As previously disclosed, Kindred entered into a definitive agreement with BlueMountain under which it will sell the Company’s skilled nursing facility business for $700 million in cash. The sale includes 89 nursing centers and seven assisted living facilities, which collectively have approximately 11,500 employees in 18 states. Thirty-six of the skilled nursing facilities (the “Ventas Properties”) were or continue to be leased from Ventas, Inc. (“Ventas”) (NYSE:VTR), and Kindred has an option to acquire the real estate of the Ventas Properties for an aggregate consideration of $700 million. As Kindred closes on the sale of the Ventas Properties, Kindred will pay to Ventas the allocable portion of the $700 million purchase price for the Ventas Properties and Ventas will convey the real estate for the applicable Ventas Property to BlueMountain or another designee. In connection with the initial closing, Kindred paid $488 million to Ventas for 22 of the Ventas Properties that were included in the initial closing.
The completion of the remainder of the transaction closings are subject to customary conditions to closing, including the receipt of all licensure, regulatory and other approvals. Kindred expects that the remainder of the closings will occur in phases as regulatory and other approvals are received. Kindred expects that all of the closings will be completed by year end.