Ventas, Inc. said on Monday it would acquire New Senior Investment Group Inc.(New Senior) in an all-stock transaction, valued at approximately $2.3 billion, including $1.5 billion of New Senior debt.
New Senior is a publicly-traded real estate investment trust with a portfolio of 103 senior housing properties located across 36 states in the United States.
”Building on the strong momentum we are experiencing in our business, we are delighted to announce this strategic and accretive acquisition with New Senior that expands Ventas’s position in senior housing at an important inflection point in the cycle as the senior housing industry rebounds,” said Debra A. Cafaro, Ventas Chairman and CEO.
“I am excited to include the New Senior assets in our portfolio. These independent living communities represent a strong fit with our existing portfolio, as we enhance our senior housing business to capture upside from the industry recovery,” added J. Justin Hutchens, Ventas’s EVP, Senior Housing.
Under the terms of the agreement, New Senior shareholders will receive 0.1561 shares of newly issued Ventas stock per share of New Senior common stock.
Based on the closing price of Ventas common stock on June 25, 2021, this represents approximately $9.10 per New Senior share, a 31% equity premium based on New Senior’s 30-day trading average, and a 10% premium on New Senior’s total enterprise value.
”The Transaction valuation is expected to represent approximately a 6% capitalization rate on expected New Senior 2022 Net Operating Income and is expected to be approximately $0.09 to $0.11 accretive to Ventas’s normalized funds from operations per share on a full year basis.,” said Ventas in a statement.