Ventas, Inc. (NYSE: VTR) is to acquire Ardent Medical Services, Inc., a Nashville, Tennessee-based provider of health care services, for $1.75 billion in cash.
The transaction is expected to close mid-year 2015.
Ardent Health Services will be entitled to distribute up to $75m in excess cash to its existing shareholders including private equity funds managed by Welsh, Carson, Anderson & Stowe.
Led by David T. Vandewater, President and Chief Executive Officer, Ardent Health Services and its subsidiaries own and operate health systems in major markets in the U.S. currently generating approximately $2 billion in annual revenues with over 50% of its revenue derived from commercial (private) payors.
Concurrent with the closing of the transaction, Ventas intends to separate Ardent Health Services’ hospital operations from its owned real estate and sell the hospital operations to one or more newly formed entities owned by current management of Ardent.
Ventas will own ten high-quality hospitals (and related real estate) operated by Ardent under the names BSA Health System in Amarillo, Texas, Hillcrest HealthCare System in Tulsa, Oklahoma and Lovelace Health System in Albuquerque, New Mexico. These assets include acute care, heart, rehab and women’s health hospitals, comprising approximately 3.2 million square feet and 2,045 beds.
FinSMEs
06/04/2015
Ventas expects to fund the transaction on a leverage neutral basis with proceeds from previously announced dispositions and loan repayments, bank debt and long-term debt and equity capital sources.
Advisors
UBS Investment Bank is serving as exclusive financial advisor to Ventas, and Kirkland & Ellis LLP and Waller Lansden Dortch & Davis, LLP are serving as legal advisors in connection with the transaction. Barclays is serving as exclusive financial advisor to Welsh, Carson, Anderson & Stowe and Ropes & Gray LLP is serving as legal advisor. Katten Muchin Rosenman LLP is serving as legal advisor to Ardent Health Services.
www.welshcarson.com