Genesis, Skilled Healthcare merger to create huge long-term care provider with more than 500 facilities

Share this article:
George Hager
George Hager

 

Genesis HealthCare and Skilled Healthcare Group Inc. will merge to create a single long-term and post-acute care company with more than 500 facilities nationwide, the providers announced Tuesday.

The all-stock deal is the latest instance of consolidation in the sector. Less than a month ago, Brookdale Senior Living and Emeritus Corp. closed a $2.8 billion merger, and Kindred Healthcare has been aggressively pursuing an acquisition of home healthcare company Gentiva. Providers have forged deals largely in response to the Affordable Care Act.

"We are positioning the companies to react to a system that is changing and becoming more outcomes-based and pay-for-performance-based," Genesis Chief Executive Officer George Hager said in an interview with Reuters on Tuesday.

Hager will be CEO of the combined company, which will go under the Genesis name and be based out of the Genesis offices in Kennett Square, PA. It will be traded on the New York Stock Exchange. Skilled Healthcare currently trades on the exchange, but Genesis shares have not been publicly traded since a 2007 transaction with private equity firm Formation Capital.

Skilled Healthcare CEO Robert Fish previously served as chief executive of Genesis. His history with both companies means he can “fully appreciate the tremendous value” of the merger, he stated in a news release.

"The combination will expand our core business lines, significantly diversify our markets, provide opportunities for increased efficiency and enhance our collective ability to provide the highest quality patient care,” he stated.

Skilled Healthcare shareholders will own 25.75% of the vote and value of the fully-diluted equity of the new entity, and Genesis shareholders will own the remainder. The Board of Directors will be blended and also include some independent directors jointly selected. Revenue is expected to be about $5.5 billion annually.

The deal is expected to close early in 2015.

Share this article:

More in News

Also in the news for Oct. 31, 2014 . . .

Minnix hopes White House aging conference will spur 'huge shift' ... CMS finalizes home health payment reductions ... Dementia is now No. 1 killer of women in England

Breier named new CEO at Kindred

Breier named new CEO at Kindred

Kindred Healthcare announced Thursday that it has chosen a new top executive to lead its push toward creating a mammoth national brand. Benjamin A. Breier, the company's current president and ...

Proposed managed care rule could accelerate shift away from nursing home care, official suggests

Proposed managed care rule could accelerate shift away ...

Proposed regulations slated for early 2015 likely will affect how Medicaid managed care balances home- versus facility-based long-term care, news sources reported Wednesday.