Manor Care going private in mammoth $6.3 billion deal
Continuing a trend among major long-term care players, Manor Care Inc. has opted to sell itself to a privately held company.The Carlyle Group, a global private equity firm, last month disclosed that it is planning to purchase Manor Care, the largest nursing home chain in the country, for $6.3 billion, including debt.
"The board of directors and our financial advisors thoroughly evaluated a wide range of strategic alternatives to maximize shareholder value," said Paul A. Ormond, CEO, chairman and president of Manor Care. "Partnering with top tier firm Carlyle and providing our shareholders with this attractive valuation is the best of those alternatives," he added.
Upon the deal's closing, which is expected in the fourth quarter of this year, shareholders of Toledo, OH-based Manor Care will receive $67 a share. That represents a 20% premium compared with the $55.75 closing price on April 10, the day before the company said it was mulling a sale.
The Manor Care announcement comes on the heels of other similar transactions. Last month, a privately held joint venture between Formation Capital LLC and JER Partners finalized its purchase of the nation's third-biggest chain, Genesis HealthCare Corp. for $1.43 billion excluding debt. Last year, an affiliate of Fillmore Capital Partners LLC, of San Francisco, purchased the chain that was formerly known as Beverly Enterprises Inc., for approximately $1.8 billion.
Rising demand for nursing services from aging Americans, and higher, stable Medicare payments, are luring buyout companies to the field, experts say.