Medical Properties Trust Buys Behavioral Health Portfolio
After Acadia Healthcare Company, Inc. (NASDAQ: ACHC) divested Priory Group, its U.K. behavioral health care business, for $1.47 billion, Priory Group is doing some unloading of its own. Now backed by Waterland Private Equity, Priory Group is selling a portfolio of approximately 40 select behavioral health facilities located in the United Kingdom to Medical Properties Trust, Inc. (NYSE: MPW). The Birmingham, Alabama-based REIT will pay approximately GBP 800 million, or $1.087 billion, plus customary stamp duty tax and other transaction costs. The properties will be subject to long-term sale-leaseback agreements with Priory, which are expected to provide MPT a GAAP-basis yield of 8.6% and... Read More »
Steward Health Care Goes to the Docs
The largest privately held hospital chain in the United States is now owned by a group of physicians who practice there. Steward Health Care System LLC was sold by its founding owner, Cerberus Capital Management, to a management group of Steward Health Care physicians led by the company’s CEO and founder, Dr. Ralph de la Torre. Dr. de la Torre, a cardiac surgeon, was tapped to run Steward’s predecessor, the six-hospital Caritas Christi Health Care in Boston, in April 2008. The current deal was structured as a recapitalization, with no additional leverage added to Steward’s balance sheet and Cerberus’ controlling interest was exchanged for a convertible note. The new... Read More »U.S. Hospital Deals and Trends, YTD 2019
Winding down to the end of 2019, it’s a good time to take stock of this year’s U.S. hospital M&A market. In mid-November, we have 70 transactions on the books, up 16% compared with the same period in 2018. But 2019 M&A activity has taken a decidedly different path from the deals of 2018. One striking statistic: Just half the number of beds have traded hands in 2019. By this time in 2018, the bed-count in target hospitals was 25,309. In 2019, there are only 12,901 (-49%). In 2018, a few major systems changed hands, which pushed up the bed total. The largest was Apollo Global Management’s $5.6 billion take-private deal for LifePoint Health (formerly NASDAQ: LPNT),... Read More »
U.S. Hospital REIT Deals Surge in 2019
It’s become an accepted, almost expected, transaction. Privately held hospitals sell their real estate assets to a real estate investment trust (REIT) to get some fresh cash and to focus on operations rather than physical plants. Between 2009 and 2012, REIT deals for U.S. hospitals were announced once or twice a year. The number rose to six per year in 2013, 2015 and 2016 (just three in 2014). After two years of two or three deals annually (2017 and 2018), the number has already reached seven in 2019, with several weeks of deal making left in the year. The most recent deal was announced on November 5, as LifePoint Health agreed to sell the real estate assets of 10 unidentified... Read More »Schedule a demo
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